What were Paramount/DreamWorks thinking?

[sphdle1]

What were they thinking? All they essentially did was hurt the consumer, hurt the adoption of High Def, prolong the war, and prolong the inevitable adoption of Blu-ray technology.

I don't understand the logic in their move to exclusively support HD DVD.
It doesn't make sense from a money perspective because the payoff is peanuts for them, so shouldn't have been that significant. And it essentially amounts to a bribe which when the whole EU thing is over, they will not likely get away with it anyway (If they want their movies over in Europe that is..).
It doesn't make sense from a consumer spending perspective because now they are just prolonging the agony and hurting consumers that wish to watch their movies in High Def BD. Plus they just lost out on the biggest opportunity to sell a lot of Blu-ray discs with Transformers & soon to be Shrek 3.
I don't understand it from an internal point of view, as they are not getting support from & are in essence pi55ing off their star Directors (Spielberg & Bay), who may in the end just move to Universal.

There must be some deeper hidden political BS going on behind the scenes that the public is not aware of... Unless they just wanted to prolong the war to help get the spirit of competition to bring prices down faster for consumers, but I think there would have been enough competition to bring prices down if they didn't make this deal, and it would have ended the war much more quickly...?