The pivotal spring of the company's decision is the increasing failure of the CD-format's copy protection. Especially in Germany a lot of illegal copying takes places -- the country bears the lamentable title of Weltmeister (World leader). Eidos Germany's decision is especially prudent considering its line-up for 2003 -- games like Commandos 3 and Deus Ex 2 are bound to be titles in demand.It's an interesting move, and one that might be a little premature. Still, moving titles to DVD will likely take a big bite out of the ISO warez scene, especially for single player games that don't require online authentication.
Thanks to Shacknews for the tip.