1. its not that expensive. bluray discs today have already dropped to the price of dvd’s just 6 months to a year ago and it took a very short time. i remember new dvd’s a few years ago were $25 and up. the bluray discs i have in my collection were all less than $15, some less than $10. yes, dvd’s are in a firesale now for like $2-$5, but that is bec/ retailers are moving towards bluray and trying to get rid of dvd’s. remember audio cassettes?
2. the clarity and sound is on another planet. if you are watching on a 13 in laptop, then maybe it doesn’t matter to you. but on a larger screen, its hard to even watch a dvd or sd download after getting used to bluray. its not just to ‘count the pores’ on actors’ faces. the overall warmth and clarity is heightened and i find myself noticing more subtle movements and nuances from the actors’ performances than i did before. much wider gamut of colors. don’t knock it before you try it in your own home on an hd display. sound is uncompressed and you can hear the difference. any torrent or hd video you download even 1080p has compressed both video and especially sound, and its close but just not the same as the actual bluray disc. for some, that is important.
3.ubiquitous bandwidth is not yet here, and not a reality for many. most of the isp’s are already shaping traffic and imposing caps. in many places like parts of europe, asia and south africa, bandwidth is charged by use. fees are exorbitant. some friends tell me they literally think twice before watching a youtube video. nothing is free — someone has to pay whether it is you (fees), the isp (bandwidth) or the content providers ($$). i am a heavy downloader, but for some of my favorite films i keep a watch on prices and often buy my favorites on bluray when they are cheap. now in a world where there is literally unlimited bandwidth and speed everywhere with smart home media devices to take advantage of it, then sure, you don’t really need bluray. but its not here yet.

an anecdote. i decided to download an hd movie and watch it with my wife. i have a 20mb/s fast connection, usually works fantastically. download started, about half way through it hung and seemed to never finish. wasn’t my internet connection, because it was working. already had paid my money. an hour later the window of time for wanting to watch a movie was passing. i headed over to blockbuster and had the bluray in hand and back home and watching in less than 15 minutes. stuff happens, and online hd is great when it works, but sometimes it just doesn’t. (granted, i understand that the opposite happens when you want to avoid lines at blockbuster! ;) )

in my opinion, they need to drop the prices of online video big time to make it worth it. pretty soon blurays are going to be $10 and less.