Maybe, but if your going to buy a new TV, you may as well get one that's bigger and better than what you already have, and also get a full 1080 spec big bastard!! In the UK a 40" Sony Bravia cost around £600 - £700 depending where you go.
Still, £700 for a TV and around £250 say for Blu ray + a few films, you're looking close to a grand. Which for some, including me, is a little out of the price range. An then there's the subscription fee to the HD service through satellite which is an extra £10 a month I think + the one off charge for the HD box.
I have so many mates with big bloody plasmas or LCD's with no blu-ray and no HD service. I mean what's the point. Everthing they watch looks all pixalated and shit. I'd rather stick with what I have for now.
Besides, I can't really get a flat screen TV just yet, as my kids like to put their sticky fingers all over our current TV. I'm forever cleaning that bloody screen!