"...Unless Universal plans on taking a bath to shut down HD DVD, they BETTER start treating this thing like a war and flood the market with as many releases as they can...."
Yeah, I doubt they plan to just throw in the towel. Do DVD sales have some cycle over the year, where certain months are always slow, and peaking in certain other months? Could they be timing releases for a peak month? It's a stretch, I know- it just doesn't seem like they are throwing their max effort out. But then, I guess nobody else is, either.
"...Actually, you have that reversed....."
No. Look at the hardware manufacturers; that's who I was referring to. Capacity and cost/GB count more in that field.
"...That said, I'm sure soon to be released "universal" players and price cuts on next gen HD-DVD players will swing the market several times - each way - in the not too distant future..."
The "universal" player from LG is a poor HD-DVD player. It plays the movie, but very little else. Some of the best HD-DVD features just aren't supported. There likely won't be any decent universal players until both camps agree to allow it. And the followup HD-DVD players seem to be at least as expensive, as they are subsidized less (or not at all). I wouldn't look for any great price reductions this year. The $200 dedicated player is not in sight.
Regarding the rental market, you may be right. They may be a big factor. The question is, will they be leading the market or following it?