It is sad as it clearly represents the begining of the end for high quality physical media players. However, I don't think it's as clear cut as an end to physical media.
In the UK, it seems like UHD is badly failing as there are so few titles available (WhatHifi stated "over 200" in March) compared to the US and the prices are stupidly high. But I would consider Blu Ray to be a failure in the UK too - not many people I know have a player and it's still very rare to find Blu Rays in charity shops (and I've looked in quite a few non-London regions).
In the US it was reported last year that UHD Blu Ray had got off to a much better start than Blu Ray which had surprised the studios and is likely why we're seeing a surge in catalogue 4K releases. I was living in the US when 4K discs launched and there were special areas in Best Buy and Walmart for 4K discs (even in rural Indiana) so I think it was getting a push.
However, I think the main reason higher quality discs have failed to go fully mainstream is that DVDs are 'good enough'. I know so many people who have large HD tvs and still watch DVDs or Freeview SD - people just want bigger, not better! I'm sure profits and DVD sales are down a lot, but that's because if someone wants a DVD they can get it for under £3 from a charity shop or Amazon Marketplace second hand (which, of course won't be recorded as a sale). When you think about whey DVD was such a success it was simpy because if offered so many benefits over VHS: smaller physically, no rewinding, no degradation, instant playback/chapter skips, special features, whole seasons of shows in one set. Improved picture and sound were likely far down the list of benefits for most people. Now look at Blu Ray and 4K - what do they offer over DVD? A better picture and sound - not really enough for the average man on the street to get excited about. What about streaming? That offers not having to buy a film in advance, no physical size at all, no chance of loosing or scratching a disc and again, better quality picture/sound (if they plump for HD/4K) is probably down the list of benefits most people consider. The down side of streaming is internet speed, but as Netflix will work with only 2 mbps for SD this likely won't be such an issue by the end of the decade.
Where does UHD go from here? Hard to say - I think the disc market for new high-profile releases and famous catalogue titles (e.g. BTTF, Star Wars, Aliens, Indiana Jones etc) will remain strong for collectors, but indie films (e.g. Lady Bird) and catalogue films that have faded from memory (e.g. Copycat to pick a random example) likely will remain limited to streaming. Players will be provided by the regular CE companies - but I don't think prices will come below the magic £100 mark for a good while.