Europe has a very specific context:
First of all, HD TV sets used to be rather expensive up until recently. They're now projecting very solid sales for the holidays. This, in turn, will grow the hi-def formats some more.
You have to understand that sports - and not movies - is the main vector to sell HD screens. And for the 1st half of 2007, the truth is that there weren't so many HD events on television. But since the early Fall, things are now different. Many games of the Euro soccer championships (like the Premier League, the Bundesliga, the L1 and clearly the Champions League) are in HD, and these TV packages are heavily advertised.
When we come to movies, the selections of Blu-ray and HD DVD is still more limited than in the USA. Retailers are now making some efforts to promote HD, but in some countries the theatrical windows are keeping some blockbusters off the shelf. For instance Transformers won't be released in France before end of February. And your BOGO and other promotions are definitely sexier than ours.
HD DVD really has a more limited selection of hot titles compared to the US. The only exception seems to be Germany, because of some coproduction deals with Hollywood that involve companies that appear friendlier with HD DVD. But in the UK and France, Blu-ray has a very solid edge. The Spidey saga and POTC3 are out now, and if it weren't for Warner, HD DVD wouldn't have many blockbusters. And this sales difference is clearly playing in Blu-ray's favor, for the publishers that are sitting on the fences right now.
And also, you have to consider in the gaming department, Europe has always been Sony's and Nintendo's 2nd home turf. The UK is the only country where the X360 sells quite well. So you won't see any drastic increases in HD DVD's add-ons because the nature of the market is quite different. On the other hand, the PS3 appears to be selling well with its discounted price, and at least a few of these buyers will buy some BD movies as well.
And finally, many european countries have specific laws that regulate or forbid sales below cost. It would be extremely difficult -- if not impossible -- for Toshiba to sell a player at 99 Euros, unless they'd be willing to open their accounting books and show that this isn't dumping.
All in all, I think that you should expect an increase of sales and numbers in the next few months. But according to the actual trends, Blu-ray should be the main beneficiary.
and raise you a 
.. i wanted independence day
