The movie studio Warner. Bros had been backing both Sony's Blu-Ray and Toshiba's/Microsoft's HD-DVD for a while, however they have now exclusively switched to Blu-Ray. Warner announced this at CES, and as a result, HD-DVD then canceled all of their one-on-one press meeting and their press conference. Warner had originally backed both formats in order to see which would sell more copies, which the Blu-Ray evidently managed to do. Warner calls this a "strategic" decision while "the window of opportunity for the high-definition disc is still open."
What May Happen
With Warner now with Blu-Ray, five of the major seven studios are now backing Blu-Ray. This means that the high-definition war may soon be over. However, Toshiba reportedly did pay Paramount $150 million in incentives, so they'll probably have to stick with HD-DVD for a while. Sony may end up with a big win here soon.
And now for,
We could be all screwed. If Sony does manage to win, they can raise the price of their players, and nothing can stop them because the own the technology. Unlike with DVD, which is a standard, Blu-ray is not and right now not anyone can make Blu-ray products. This could also give the PS3 a big boost, seeing as it is a cheap Blu-ray player. This could extend the console war for much longer. At least we still have regular DVD's avaliable for purchase to fend of the attacking high definition crowd.