DVDs will become and in the technical sense are already obsolete. However, the market penetration for devices that play DVDs is immense; think Laptops, Portable DVD players, Car DVD players, TVs with integrated DVD, Audio systems with integrated DVD, and HD-DVD players and Blu-Ray players.
Even though VHS is gone, people still have large VHS collections and players to go with them.
In addition one thing not to overlook is the fact that its only a laser and disc "format" change, not a transport mechanism change. Try sticking a DVD into a VHS player or vice-versa
It's still a 12-cm disc just like CD, Video-CD, CH-DVD, CD-ROM, HD-DVD, Blu-Ray and other formats. The 12-cm disc size seems to have become the de facto standard for disc sizes; even future "disc" technologies (except for flash memory) seem to be geared for that size as well.
Since most if not all DVD players still play CDs and most play Video-CDs, it is likely the nearly all Blu-Ray players--I think all do right now--will still play DVDs for the entire life of Blu-Ray and any successor format would be remiss not to include it as well.