To me, the software is the key. Not many peole are going to buy the players initially, so it will be a wait and see game. PS3 will sell if it's at a good price point, but not that many people will use it for movie watching IMO. There may be several folks on here that will, but for John Q Public, I don't think so.
Software is the key. The problem arises in what store will carry which format? Will BB align with one and CC the other? What about Wally world? In my area at least, CDs and DVDs were slow to come around because of inventory. No one wanted to carry the same release in three formats. The same will happen with HD movies. Anyone with any business smarts knows that too much inventory is a killer, especiall if it isn't moving! Also, what about the average uninformed consumer? They go into Wally world to buy jr or the neighbor's kid a movie and have no idea what they picked up off the shelf. MAYBE the checkout chick (or dude) will ask if they have the right format, but probable not. And how will the customer even know what jr/neighbor wants or needs?
Multiple formats are going to kill sales, period, I believe. I know that competition is good for the consumer as a rule, but not in this instance.