The easiest way to answer this is that: yes you will need a new sound system if you want to take full advantage of the HDMI connectivity. However, if your receiver has an additional optical input on it you will be OK. The HDMI connection is most important for Video at this stage of its life anyway. Most receivers now that accept HDMI are having issues with the digital audio, so the HDMI will go directly to the TV, and then an audio or fiber optic/coaxial cable is then run to the stereo system. If you’re in the market for just an upconverting DVD player and not a Blu-Ray or HD DVD player then take a look at the Sony HT-7000DH for $500 (http://www.bestbuy.com/site/olspage.jsp?… It’s an HTIB system with an upconverting DVD player and receiver with HDMI capabilities. Great buy for what you get.
I hope this helps.