As usual gonk nailed most of the issues in his last two posts. I'll just add a couple of minor comments. The present processors may very well have the "power" to decode the new formats, but you have to have a way to get it the signal. Keep in mind that the new HD versions of DD and DTS are 7.1 channels of uncompressed audio, which is far beyond toslinks capability. It has also been rumored that the new formats may just send the audio out as PCM over the HDMI port, which basically means the decoding would be done in the player.

The other thing to keep in mind is the new formats are supposed to be downward compatible so even though you may not get the latest and greatest audio the players will probably still have a toslink downmix available. Whether we will get 7.1 Hi-res analog outputs is anyone’s guess. Same is true for the video side I doubt very seriously we will see analog outputs higher then 480P, but I imagine we will still see all the various video formats just down converted.