Well the specific blu-ray portion is meaningless as the encryption on the disks themselves has already been broken, so you're essentially free to do what you will with them. Interesting find none the less, not sure what it'll lead to though. Maybe homemade HDCP dongles to plug into older devices that don't support it to get them working again?
The useful applications for this are pretty limited, unless I'm really missing something. Still fun to see another security system broken, anyway.
I am tempted to say fuck Intel, cause we just need to wait until some pirate company makes an open HDMI and HDCP device. And then China doing fuck all about it. Cause China has already expanded the HDDVD technology.. But then again I do not give a fuck about all that encryption, since knowledge should be free, which it sadly isn't. Open Source for the win.
I think this development isn't terribly important. As far as I already know, China already makes devices which can strip HDMI signals of their protection and output directly to Component and other unprotected formats.