If you have a read of this there are some approaches underway in the current release to reduce the Blockchain size, or at least mitigating the problem in the anticipated future use of the Blockchain for things like data storage:

http://bitcoinexaminer.org/gavin-andresen-talks-about-the-0-9-release-what-is-finished-and-what-still-needs-to-be-done/

We don't want to carry around the entire Blockchain everywhere we go so it makes sense for a more streamlined approach to be taken. I think the section about "Provably Prunable" outputs is the relevant part here involved with reducing cockchain overhead. Other projects like Mastercoin which ride on top of the Blockchain also deal with some of this too.

Regardless, it's an evolving technology and the market will decide on the best approach and trade-off between functionality, size and performance.