Paramount Pictures, a company that was previously exclusively backing HD-DVD as the format to replace the DVD, has announced it will also be supporting the rival format, Blu-Ray. Apparently a major reason for the switch in support was the Playstation 3, which will include a next-gen Blu-Ray drive at release.
Sony was a major proponent of the original DVD format, in that their Playstation 2 console was so much cheaper than regular dedicated DVD players. The PS2 increased the adoption rate of the DVD due to its low price and the lure of a low price DVD player made people buy PS2s. It's likely that Sony is going for the same tactic this time around. Dedicated Blu-Ray players will likely be more expensive than the Playstation 3 at launch, leading consumers to pick up a PS3 purely for the High Definition playback. Expect Sony to take a substantial hit on each PS3 as they try and lure bargain hunter consumers.
