Blockbuster announced on Thursday that they are expanding their Blu-ray business in both the U.S. and Canada to reach nearly 5,000 stores. In addition to Blu-ray movies for rent, Blockbuster will also sell Blu-ray titles. To emphasize the Blu-ray format, Bockbuster is adding Blu-ray kiosks with a a 42-inch HDTV driven by a Sony Playstation 3. Those who rent movies by mail will now have the additional option of setting a Blu-ray preference.

In July of 2007, Blockbuster started renting Blu-ray titles in 1,700 of its stores. With today’s announcement, that expands to nearly 5,000 stores.

"Blockbuster was the first national retailer to accurately recognize and react to consumers’ preference for this format when we added Blu-ray discs to a large percentage of our stores last summer," said David Podeschi, Blockbuster Senior Vice President, Merchandising, Distribution and Logistics. "Now, with this national rollout, we believe Blockbuster is perfectly positioned to drive consumer adoption of this next generation DVD format and to become the customer’s headquarters when it comes to renting or buying Blu-ray movies, whether in-store or online."

Meanwhile, Netflix has been offering a Blu-ray option since May of 2006, but there was little to chose from. The company recently announced that they expect to add as many as 1,500 Blu-ray titles in 2008. That’s compared to about 80,000 DVD titles.

Last week, TVPredictions predicted that Blu-ray player prices will fall to less than US$200 by Christmas.