Some HD-DVD players have dropped below the US$200 mark in the US, making them very attractive to consumers and putting increasing pressure on Blu-ray player manufacturers.
Reminiscent of the VHS versus BetaMax battle, the high-definition format war has raged for months, with some analysts predicting no end in sight.
The situation has left many consumers sitting on the fence waiting for a winner to emerge before selecting which format to buy.
However, some commentators have pointed out that the falling price of high-definition players, combined with the rise in content and HD TV ownership, means that many may take this holiday season as an opportunity to move into the high-definition world.
If this does happen, Kmart's abandoning of Blu-ray may prove detrimental to the format and give a big boost to HD-DVD.
Regardless of the outcome, standard DVDs seem to have had their day. Japan reached its peak for DVD player sales in 2003, while US and European DVD player shipments peaked in 2005, and will continue to decrease this year.
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