Sounds like they were asked to give a bid and weren't actually offered a contract. The last sentence sounds like they are trying to get other manufacturers on board.
An inquiry is not exactly a deal. So its false. No one has signed a contract, so its false. No order was taken, so its false. Hedging, negotiations, inquiries does not exactly equal to 2 million $299 HD DVD players on order, so its false.
As a PS3 owner.........I'm actually bummed out by this news.
I just want an HD format to succeed, whether it's BD or HD-DVD. Even though I own a PS3 and about 25 BDs, had this story proved true, and HD-DVD became mass-market priced, then the floodgates would open with regards to software. I would not have cried at all as I pulled out my credit card to buy an HD-DVD player.