I always find that interesting, because to my eyes the quality jump from DVD to Blu-Ray is the biggest we've ever seen (and likely ever will see) in home video formats, way bigger than the move from VHS to DVD. I don't think DVD has aged particularly well, especially in a world of non-interlaced digital flat panel displays. A properly mastered Blu-Ray disc still looks considerably better than the HD streams being offered by just about any modern streaming service, but DVD generally looks worse than your typical 480p stream.
Some DVDs are poorly mastered, and modern encodings are better than mpeg2 at the same bitrate, but 480p DVD should compare well to bandwidth limited 480p streaming.
If S-VHS had ever caught on for commercial releases, then the jump might have been smaller, but a VHS was visibly worse even on screens of the time, and screens were getting bigger pretty fast back then.
Also, DVDs were fundamentally very different from VHS, while Blu-Ray is just the same thing but incrementally better (yes, I know it's pretty different in a lot of important ways, but it looks very nearly the same, and you use it the same way).
DVDs introduced or normalized:
1) Surround sound on home media.
2) Widescreen picture (widescreen VHS existed, as did pan-n-scan DVD, but DVD popularized home widescreen video sources)
3) "Extras"—sure, you'd see the odd making-of feature on a second tape with some VHS releases, or available separately, but nothing like e.g. commentary tracks.
4) Multiple audio options from one piece of media (original audio plus dubs on foreign media)
5) Nice-looking captioning, potentially in multiple languages, not like ugly VHS/TV CC managed by the TV.
6) No rewinding.
7) Chapters & menus.
8) ... probably more that I'm forgetting about.
Plus they didn't degrade every time you played them (provided you didn't scratch them when handling the disk) and pretty much never self-destructed in the player.
Granted, Laserdisc did some of this too, but it was too expensive and too bulky and ~nobody had one. I'm not even sure more than half the population of the US knew laserdisc existed.
Meanwhile, Blu-Ray brought us... more pixels. And the disks are more durable. A few other features, sure, but only nerds know about those, really. That's about it. The pixel-count increase was big, but it wasn't a whole new thing.
In short: DVD was a new thing; Blu-Ray was "just" better DVD. Consider: almost nobody called a DVD a tape. Tons of people still call Blu-Rays "DVDs".
Whatever the technical merits of Blu-Ray over DVD, it simply didn't make as big a splash. Probably didn't help that streaming services were starting to make non-film-geeks reconsider having a home video library at all, early in Blu-Ray's lifespan.
> A properly mastered Blu-Ray disc still looks considerably better than the HD streams being offered by just about any modern streaming service,
Heh, especially Netflix. Encoding artifacts everywhere. Every dark scene is a bunch of big squares. Terrible, terrible picture. I can get 2GB(!) h.265 blu-ray rips @ 1080p that look way better than Netflix's 1080p. The problem is they're (streaming services generally, that is) incentivized to make the stream as bad as they possibly can, without driving away too many customers, because storage and data transfer costs are major expenses for them.
This. DVD arrived back in the CRT-era when most screens were both smaller and had lower resolution than modern screens. When Blu-ray hit the market, 32"+ flatscreens had started to become mainstream.
If you try watching a Bluray on a 24" CRT TV then you'd hardly notice the difference when comparing to a high-quality DVD release.
I still say if SEGA went DVD with the Dreamcast we'd have a totally different console scene, but I'm also a huge SEGA fangirl, so what can I say.