Movie industry executives participating in a panel discussion Tuesday at the HD3 conference in Century City agreed that the economic downturn could hurt the holiday sales of Blu-ray Discs.

"The economy is the biggest challenge, because there are just so many pieces to the Blu-ray puzzle that consumers face," said Lori MacPherson, GM of domestic home-entertainment at Disney, according to The Hollywood Reporter. "You need the high-definition television set, you need the player, you need the cables, you need the software . . ."

"The economy is hitting everybody," said Danny Kaye, executive vp research and tech strategy at Fox. "But we still look forward to a great fourth quarter."

"I know the economy is tough right now, but the manufacturers are really bringing down the price of their HDTV sets," Paramount vp marketing Chris Saito said.

Although some Blu-ray player prices are currently flirting with the $200 price point, the majority of the Blu-ray players still sell for considerably more.

In addition, movie releases on Blu-ray sell for upward of $25, whereas most DVDs retail for $15 or less.

"We're all constantly looking at (disc) pricing," Sony vp business development Rich Marty said. "What it amounts to is that we'll wait until after the fourth quarter and see how it goes."

On the other hand, Blu-ray backers are more optimistic.

"It may slow adoption down a little bit if there's a recession brewing," said analyst Tom Adams of Media Research in Carmel Valley, Calif. "But in the adoption of other successful technologies over the next 50 years, it hasn't been more than a speed bump."

In any event, Blu-ray proponents shouldn't panic over the prospect of a longer slog toward broad consumer embrace than some might have hoped for, Fox's Kaye said. "It never happens overnight," he shrugged.

Disney's MacPherson also said that the latest DVD players that boost DVD image resolution via so-called upconverting technology fail to match Blu-ray standards.

"For me, it's the difference between costume jewelry and a diamond," the Disney executive said. "Costume jewelry is nice, but I still want the diamond."

Analysts have also predicted a dramatic drop in Blu-ray sales for the fourth quarter and beyond, pushing back adoption of the technology long enough to allow other forms of video over cable, satellite and the Internet to shut the window of opportunity for Blu-ray. Hollywood execs seems to ware of the situation and they are expected to carefully scrutinize Blu-ray sales after Jan 1. Depending on how things go with HD discs and other packaged goods sales, it's possible that the industry's go-slow approach on digital downloads could accelerate.

Many studios have already made some minor steps towards the digital distribution of movies, either by making some titles available for digital downloading or by offering "digital copy" editions of DVD releases. Purchasers of such discs can upload a digital copy of a movie from the DVD to a personal computer.