They are both HD formats and both have a good picture and are capable of 1080P video. Like the battle years ago between VHS and Batamax in the end there will only be one format that survives.
Blue-Ray is winning this war and professionals are predicting that by the end of the year HD-DVD will go away.
Facts:
1. Blue-Ray is out selling HD-DVD in players and movies 3 to 1.
2. 5 of 7 major studios only put their movies out on Blue-Ray.
3. Netflix is no longer renting HD-DVD, just Blue-Ray and standard DVD.
4. Wal-Mart is pulling out of HD-DVD
5. Best Buy, the largest electronics retailer in the USA this week decided (quietly) they will be backing Blue-Ray only, when the HD-DVD they have in stock is gone they are not restocking it.
In the near future the backers of HD-DVD will have to cut their losses and discontinue it. So when HD-DVD is gone you'll have a over priced DVD player, with no HD content to play.
If you want a HD player get Blue-Ray, you'll be glad you did.
Source(s):
owner PS3 (Blue-Ray)
owner 4 HDTVs
Electronics Consultant