You're right that if it were cheaper it would help alot. But remember there are other expensive parts besides the blu-ray drive. They are going to reduce the Cell cpu from 90nm to 65nm and later on they say 45nm. This will drop the cost of the second expensive component in the system. And who knows, the blue laser diodes could drop in price sooner than anyone would expect. Then Blu-ray drives won't cost so much and it'll be ok.
I'm just not convinced this is going to destroy Playstation. Surely it helps competitors like Xbox and Wii, but Playstation will survive I'm sure. But then again only time will tell.
