I know it's been said earlier up there, but yeah, I've heard multiple times that no games will be released on the HD-DVD drive (not hard drive, as someone mis-interpreted the name).
Really, I don't see any reason to include a next-gen disc format into a game console UNLESS the games are going to take up more than a typical double layer DVD disc (approximately 9½ gigs), in which bigger storage is needed. So Sony, as much as I don't like it (trying to stay a M$ fan) is going the smart way, by building it into their console. Microsoft, who PROMISED that there will be no games on their next-gen disc format, are effectively limiting their expensive drive to only be in the niche market for the people who:
1. Have an Xbox360 (which right now and for some time is, despite them saying they want to get more people, JUST gamers)
2. Don't have a PS3
3. Willing to buy a peripheral (the drive itself)
4. Not mind that it won't be HD (I think I heard the cable itself will have to lower the video quality, if proved wrong I'll take this one back)
5. And give a d*** that videos will come out on HD-DVD discs
Add to all this the dumb-a** plan of Microsoft not requiring a HD in all their consoles mean, to me, they lost this generation of the war. If it weren't for the high price of the PS3, I would be reserving it on release day. As it is, I think I'll wait for a few must-have games to come out, by the time they release the PS3 might drop in price.
Honestly, these console companies think they can reach out beyond the gamer market to whole families are just day-dreaming. I game all the time, my parents know it, but would NEVER want to play games themselves. Despite what Nintendo thinks, there's no way in hell my parents'd pick up a Wiimote and jump around. And they are "casual-gamers", in that they like playing solitare and Mah-Jong on the computer, but no more.
So please, console companies, don't say that building the first next-gen video format player into your console will get people to buy it, and ultimately the games themselves later. If someone built a new format into a $600 Unix workstation that could only develop OS's, don't think I'll buy it to watch movies on, and to later, despite me not wanting to, develop OS's.