According to their press release the move to support only Blu-ray is a strategic decision "aimed at giving consumers what they want" (apparantly not for Europe)

"The window of opportunity for high-definition DVD could be missed if format confusion continues to linger," said Warner Bros. Chairman and CEO Barry Meyer. "We believe that exclusively distributing in Blu-ray will further the potential for mass market success and ultimately benefit retailers, producers, and most importantly, consumers."

Warner Home Video will stop releasing HD DVD movies in late May 2008.

"A two-format landscape has led to consumer confusion and indifference toward high definition, which has kept the technology from reaching mass adoption and becoming the important revenue stream that it can be for the industry," added Warner Bros. Home Entertainment Group President Kevin Tsujihara. "Consumers have clearly chosen Blu-ray, and we believe that recognizing this preference is the right step in making this great home entertainment experience accessible to the widest possible audience."

For European consumers this is not an ideal situation because Blu-ray is region-locked, so you can't import the latest movies anymore. Now we are forced to hack Blu-ray players to remove the region-lock (which most of the times invalidate the warranty) The same old story repeats itself, like in the past with DVD...

In this press release Toshiba responded to the Warner Bros./Blu-ray announcement:

Toshiba is quite surprised by Warner Bros.' decision to abandon HD DVD in favor of Blu-ray, despite the fact that there are various contracts in place between our companies concerning the support of HD DVD. As central members of the DVD Forum, we have long maintained a close partnership with Warner Bros. We worked closely together to help standardize the first-generation DVD format as well as to define and shape HD DVD as its next-generation successor.

We were particularly disappointed that this decision was made in spite of the significant momentum HD DVD has gained in the US market as well as other regions in 2007. HD DVD players and PCs have outsold Blu-ray in the US market in 2007.
We will assess the potential impact of this announcement with the other HD DVD partner companies and valuate potential next steps. We remain firm in our belief that HD DVD is the format best suited to the wants and needs of the consumer.