DVDs are technologically limited right now. They can handle regular TV, but not HDTV video (Also, does not have digital rights. Next gen discs may allow us to make limited legal copies), so we have:

HD DVD: Cheap and can use many of the current DVD production facilities. Backed by Microsoft and Toshiba. Runs a windows variant. Limited in capacity, but a cheap migration to HD DVD can begin very soon..

Blu-Ray: Requires entire revamp of production lines. Offers significantly higher capacity and speed. Backed by Sony and Panasonic. Runs on Java. Will be expensive to move too, but will offer greater rewards in the end.