It's Official! HD-DVD is "dead". You can find numerous articles online summarizing Toshiba's official press release, but they all essentially say the same thing. Toshiba will stop manufacturing HD-DVD players by the end of March. And since Toshiba is by far and away the primary manufacturer and proponent of HD-DVD... well it's over.
However, I agree with this arstechnica article. I'm not sure that the future for Blu-Ray is totally rosy with digital downloads on the horizon. That said, with Blu-Ray's much better storage capacity over HD-DVD... I think Blu-Ray stands a much better chance against down-loadable movies then HD-DVD ever did.
Despite my insistence for some time that Blu-Ray was going to win this format war. I ultimate went "purple" and purchased both Blu-Ray and HD-DVD players, and have discs in both formats. However whereas I've purchased about 30 Blu-Ray discs so far... I have exactly 7 HD-DVDs. Five of those were "free" with the purchase of a player and 1 of them was a Birthday gift. So I've only really bought one disc out-of-pocket.. and it's the Digital Video Essentials calibration disc!
Something to consider though... HD-DVD players make very good up-scaling Standard-Definition DVD players... and as the bottom falls out on their prices over the next month... it may be a the cheapest way to get a very-good up-scaling DVD player. It's definately something to consider. I know I won't be quickly replacing all 600 or so DVD's with Blu-Ray discs anytime soon. So a good upconverting DVD player is definately good thing to have.
My genuine condolences to early HD-DVD adopters. As someone that owns both Super Audio CDs and DVD Audio discs, it definitely stinks to sink money into something and then witness the future dry up. That said, I don't think anyone can really be surprised by the outcome. I think it was obvious since before the launch of either format that one of them would have a premature lifespan... so regardless of which format you backed... if you were really honest with yourself at some point you considered the possibility that your chosen format wouldn't be the one that would "make it" (or at the very least would survive the other).
However, as I've said in the past.... the best future for HD-media was a single-format future. So in that respect, the end of HD-DVD represents (I believe anyway) a brighter future for HD media on the whole.
And for the record, I'll probably buy a few HD-DVD's when they get cheap. My HD-DVD player still works and some of the discs are really great, and it might be some time before we see them on Blu-Ray. When they get cheap enough that I wouldn't feel like my money was wasted rebuying it later.... you better believe I would pick one up.