I echo Isleofman’s POV, but was going to refer to the spring days of the format war whe red and blue - prices were getting lower and lower.
Outright competition appears to be the real inertia of lower pricing.
As I see it, lower manufacturing/operating costs equals increased profits only. Afterall, can we point to some tangilble experience of the industry reducing price simply because costs went down…when no competion was in the market?  Capitalism at its finest, i guess :)

Simplification of licensing is a step in the right direction, but I doubt it’s going to be the step that really drives prices down… that said, it may well facilitate a shift in the market that can drive prices down.  What is really necessary to begin moving prices into the $100 range are some Chinese OEMs putting out cheap bare-bones players… if someone like Apex, Akai, Coby, Norcent, or any other of the laundry list of 3rd tier electronics oems could bring to market a player that does nothing more than decode BD video and bitstream BD audio (with basic 2ch decoding), and do it for around $150 msrp / $100 street, you really might see people’s interest perk.  This is what did it for DVD, and with the current economy, it’s one of two things neccesary to do it for BD.

The other thing we need to see is a drop in media price.  $25 - $35 for a BD disc is just too much when DVD is still a viable option.  $20 BD discs on release day would go a long way towards making people think they can not only afford the player, but the discs as well.  $15 BD discs on release day would go even further, but that price point might be a chicken/egg type scenario… you won’t see $15 discs until the install base grows, and you may not see the install base grow until you see $15 discs.