With all this talk of comparing RED RAY to BluRay, I honestly didn't get it. At this point, you wouldn't find many movies that had been mastered above 2K, which is barely more than 1080p. Even assuming we get 4K television in the next five years...well, my question will remain "why". Most HDTV still looks crap because they don't have the bandwidth for it.
But after talking with Mike and the guys at fxphd, I realized that the exciting part about RED RAY isn't the home video possibilities. It's the idea that I can take my little RED RAY playback device and encoded media, plug it into a movie theatre's digital projector (and within a few years now, all of them will have one), and play the movie at the highest resolution that the projector can achieve. No more striking prints, no more playing off a laptop and being limited by the video card.
And that's just the start. The resistance to digital projection in the last decade or so has been due in part to how much money it would cost to do so -- in the billions to replace the old film projectors with the new and expensive digital ones. They're finally getting around to spending that money, mainly because of the push towards digital stereoscopic.
But with RED RAY coming in at under $1000, that means for the 3500 or so screens in the U.S., it would cost merely $3.5 million to hook up a RED RAY device to every single one. ($7 million on the outside, if we assume that every theatre is set up for 3D.) No more striking and shipping heavy and expensive prints. If you can burn a DVD (and what indie filmmaker can't), you can burn a RED RAY 4K "print".
I can even see the studios embracing this for the same reason. They'd save millions on every film just by burning a RED RAY disc instead of making a print. (Although you'd probably have to make some kind of encrypted "RED RAY PRO" device, so that the disc will only play back with a properly-encoded CF card acting as a dongle or something, that dongle code being specific to that run of discs. You don't want the big studio RED RAY discs being playable if intercepted.)
I still think physical media at all is just a stop-gap until movies are downloaded/streamed directly to the theatre via satellite, but even given that, RED RAY is an amazing concept that, like the cameras, will totally change the industry, especially in terms of putting the big toys in the hands of the little guy.
I get it now, and I want one.