At present, K Systems will only import standard DVD's (and CD's).
The Server's are already capable of storing HD content (in fact K provides a couple of HD programs pre-loaded on the Server when it ships), but the proper licensing to allow for BR importing (and other HD content) is not yet in place. K continues to work with HD content providers, including the BR folks, to acquire the appropriate licenses to allow for HD content storage and in regards to BR, is hopeful this will occur this year.
In preparation for the eventual (hopeful) license to allow BR imports, K is developing/has developed a BR Player (they call it a Blu Laser Player) and plan to release this new BLP later this year. The secondary goal of this BLP is to provide K owners with the ability to at least play BR disks while awaiting the licensing to allow imports. This will be accomplished through a software upgrade at the appropriate time.
Regarding the notion that BR may not even survive, while I cannot disagree (all technology advances at some point), it will likely be the HD disk standard for at least the near future and there are now many, many popular titles in BR format and the list is growing. For BR owners (myself included, with over 500 titles), we still want to eventually bring the same superb, industry leading (IMO) storage and user interface functionality to these BR titles that we currently enjoy with our standard DVD collections. So the market is still there, and K is responding to this market.
I suspect that at some point we will be able to download HD content to our K systems, but until then I'll continue to acquire BR disks (those movies that take advantage of BR).
Important to also note that K's new 1080p Players are excellent at upscaling standard DVD's to 1080p. I've owned, or directly worked with, just about every high-end, and not so high-end, upscaling DVD player that has come to market and I can honestly say that although one or two may be K's equal, none can beat it's image quality (IMO).
(I just saw Josh's post, sorry for the duplication of info!)
Jim