Or more likely because it's still freakin' expensive to mfr those BD players as well as discs... it's all economics, people.
They know very well if they cannot compete with $499, they will lose the whole game - HD-DVD will reach the critical mass way ahead of them and eventually BD will die.
They *HAVE TO* cut the prices, period. BD players were priced at insanely expensive level... Toshiba's unit was already expensive but asking twice as much makes wonder everybody what are those BD folks are smoking...