Let the hive mind of Engadget get that for you.
"I need help! I want a small pocket camcorder but I'm not sure which one to get. I don't want to fall into the hype of the Flip because I worry two hours won't be enough. What should I be looking for when considering a small camcorder and where can I get a good quality one with expandable memory? Thanks!"
It may be an attempt to prevent any support for the rival CBHD system. If everything out there's Blu-ray or compatible with most Blu-ray players (AVCHD), then CBHD doesn't stand much of a chance. So it's in Sony's interest to put out Blu-ray discs even if it increases piracy, in the longer run it'll get all Chinese industry singing from the same hymn sheet.