Steve, I think your argument is fair.
SDMC
A few years ago I refused to buy a DVD player. Why? Because my local video store didn't have any DVD's to rent at the time and there just isn't anything wrong with VCR tapes (except you gotta "be kind, please rewind"). Now my local video place does have DVD's and I bought a JVC player for about $200.00 a few weeks ago.
The argument that SDMC has gotten ahead of itself may be true as there isn't any secure documents that need to be purchased and there certainly isn't any secure documents that need to be purchased and wirelessly downloaded on a Palm device. Despite this, I think SDMC needs to be introduced at some point, even if it is used initially in a non-secure fashion as plain, vanilla storage. There may be business/industry applications which sprout up first. As a consumer I am not sure what I would buy that would need to be stored on SDMC right now.
The major difference between SDMC and its siblings, CF and MMC, appears to be that there will only be three suppliers of the card to begin with, Toshiba, SanDisk and Matsushita. I am not aware that SanDisk's competitors are allowed to manufacture SDMC. Hitachi has even tried to gain momentum with their version, the Secure MMC card, but I am not sure how sophisticated this device will be, especially if the SDMC standard is widely adopted.
Sooner or later there will be content and protocols for using SDMC. The complexity/ease-of-use may be more important than anything else. So I don't think there is any guarantee that the consumer will embrace SDMC if its use is cumbersome. There is also the issue as to why one would select SDMC over MMC if the intended use is non-secure.
MMC appears to be in the same conundrum as CF right now with a plethora of sources and few SanDisk licensees. So without a compelling reason to buy SMDC I would think an MMC purchase would be the next logical choice.
MP3
I also read with interest the article Jay posted. It would appear that flash cost will be an impediment to MP3 applications in the future. The young kids will have to chose between a device using rotating media and a huge storage capacity versus a solid state device that has less storage and can be custom loaded each day. (The question comes down to storage cost, how easily one can navigate through hundreds of MP3's on a single device, battery life, ruggedness,...) The IDC report suggests that alternatives to flash will become more and more prevalent due to $$/MB issues.
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