What he said. You would think those who want these titles would seek them out.

Yeah, the interesting thing about the LD comparison is that near the end of LD's run, many obscure, cultish films were being released in the format. It was a good match, because many LD owners were diehard film geeks who often had a taste for a wide range of films, not just the mainstream stuff. Niche films released in a niche format. I don't know if the same thing could happen with HD-DVD/Blu-ray though. But I for one would gladly rebuy my favourite cult films if they received great looking Blu-ray releases, for example. (of course for some films, a huge improvement may not be possible, based on whatever surviving elements still exist).

Often what one would think how the world and people should operate doesn't turn out to be the case. A lot of people probably aren't aware of any titles released aside from what their local video store gets in stock. Mail order has become much more convenient with the internet, provided you have a computer, but the article points out that most people still don't buy that way.

Having sold DVDs at retail for five years or so in a store that probably carries about 2,000-3,000 titles at any given time, customers are still shocked that you don't carry every obscure film at all times. When I tell them they can order it from our website, often with free shipping, or go to Amazon if we don't have it, they either reply they don't like shopping online, are scared to do so, or don't yet have the internet and this is a fairly frequent occurence. This is in a major market too (Pittsburgh), not some rural area.

I was loving the laserdisc renaissance, except that they would be $50 or more. The day I bought the exact same content on DVD for $19.99 that I'd paid $80 for on laserdisc, I was done.

This I totally agree with. Thanks to the internet and DVD I own films I only dreamed of ever finding 10-15 years ago.

However, what the article seemed to state is a big part of their sales weren't from people like the DVD Talk audience that likes obscure films and seeks them out, but from casual consumers that didn't know they wanted a title until they stumbled across it at Sam Goody. If that is true they probably are screwed.

Not sure if the "they" you are referring to are those releasing obscure films, or us consumers.

My take on the article is that it is those releasing films that are going to get screwed.

And then it will be us, the consumers, turn when there is less to choose from.

In a nutshell,
 

the companies count on the fans to buy the release, which depending on the title, they break even, if they're REALLY lucky. The casual fans can make up the difference or push it over the top. But stores like Best Buy look at the sales. When they get a better discount and better sales on I, Robot: Robot Arm Edition than Kiss Me Deadly, they go with the better sales. Plus they know that studio will be putting out 80+ titles a year, where a niche company might put out twelve if they're lucky. Without the retail spots taken up by the large companies, the future is grim. One recent cult film with some clout sold just over 100 pre-release units...period. That's NOT good for cult film lovers. Because that means these companies most adapt, or go under.

Can you tell us which film this might be?

R.I.P. Criterion

They never mentioned the 200-300 DVDs coming out as being all mainstream titles.

Is not that many. The real number must be between 150 - 200. That includes all DVD releases of all DVD studios except porn titles. Check the amazon.com new and future dvd releases page and you will see that at least 150 come each week, from mainstream films to bargain titles.

This article featured a photograph of the Tower Record store in NoHo NYC with it's "Going Out Of Business" banners. So the main point of the article can be presumably summarized in the first paragraph. Those retailers who held a vast selection of titles are finding themselves unable to remain competitive in the current physical store market.
Tower's prices were too high but the breadth of their inventory was amazing. When I went to their store closing sale I was amazed at the sheer number of overpriced really obscure/minor titles they had in their bins. The internet probably just proved too great of an equalizer for B&M merchants.