On the PC side, users have been able to enjoy support for Blu-Ray movie playback for quite awhile now. However, Apple has been reluctant to add in similar capabilities on the OSX side of things. A user recently emailed Steve Jobs, and as he tends to do these days, he sent out a curt response
predicting the death of the format
The question centered around the new Mac Mini, and how it sure would be cool if it had a Blu-Ray drive. Jobs responded saying that, "Bluray is looking more and more like one of the high end audio formats that appeared as the successor to the CD - like it will be beaten by Internet downloadable formats." In a later response, Jobs also claimed that streaming 720p content would win most people over.
It seems extremely likely that physical media will fade into the background at some point, but this may not be the time. With ISPs instituting bandwidth caps, streaming HD video could be more risky as the quality improves. Apple's iTunes store has sway over the content delivery arena, but can Apple really kill Blu-Ray by sheer force of will?