I have plenty of space and plenty of power in my living room so i don't forsee any upgrades for quite some time. The 60" Sony SXRD with WEGA engine will last some time.
My next addition will be a BlueRay. I haven't decided whether to get the BlueRay reader/writer for my computer and then use the computer with the HDMI link to the HDTV to play the DVD's, or a stand-alone BlueRay.
I went with a PS3 for my blu-ray player, for at least a few years. This CES they are announcing some nice new options. I'd certainly check all them out and skip any of the 1st generation models.