Do you want to see MS have the same kind of monopoly over the gaming industry that they do with Windows and Office applications?
I give credit to the fact that MS has really taken alot of Sony's thunder in terms of being the undisputed king they were in the PS1 and PS2 generation. MS's direct measure of success, as they have stated many times, is the failure of Sony. Why? Because they want to have the same control over the living room as they do in the office. They saw Sony as being their biggest enemy.
With Windows and Office, we as consumers and small businesses have to pay a huge premium over market price because it's really the only viable option. You can argue that Apple is there, but that has limitations. Apple really had a window of opportunity to level the playing field when Vista was released, but they wanted to keep their image as a high class setup, rather than get greater marketshare. Heck, now Apples are equipped with a similar x86 platform that IBM/PC compatibles are.
In the gaming industry, there are alternatives. The most direct alternative is the PS3, which outsold the Xbox 360 for all of 2008 until the price was dropped. A combination of brand image, percieved value (BD and free online), and reliability statistics (for PS3) helped that case. Because of that, MS lowered their price to a more consumer-friendly price and fixed their overheating issues, since we haven't heard any widespread RROD cases beginning with the Falcon revision. Isolated cases will always happen, just like the PS3 and Wii.
At the beginning of this gen, Sony really thought they were in the monopoly position so they thought releasing a $600 system when they weren't completely ready to release software was going to be ok with both consumers and developers. Obviously, other alternatives were available, and both consumers and devs have seeked other alternatives.
What I'm really concerned about, and why I've always been reluctant to support Xbox (I bought one for my jRPGs), is that once MS gets into the monopoly position, they really know how to keep it going and we consumers have to bear the grunt.
For me as a GAMER, this generation has been one of the best ones since SNES/Genesis for the same reasons. There are two companies that have to duke it out each other by constantly 1-upping their offerings. Sony has offered some of the best gaming experiences I've had since I was a kid with the likes of MGS4, Valkyria, and Little Big Planet. On the same token, MS has made it possible to get some really good jRPGs that they probably had to give some financial incentive to the devs because HD consoles are too risky for most jRPG developments outside of big titles like FF that cater to a small fanbase.
In the end, we want the competition so the benefits are passed on to us - the gamer.
I agree with MOST of what you said no one wants a monopoly on ANYTHING, look at the cable companies. Once ANY company get a monopoly things are not going to be good. As you mentioned Sony came really close to one last generation and look what it did to them they had the arrogance to come out with a $600 system imagine if we didnt have Nintendo or Microsoft.
Also not to pick on the WII but since they are curshing the competetion have we seen a price drop on the $250.00 WII? No cause they dont need to, to be honest the system is overpriced though you dont see an out cry cause of that.
I support MS this generation cause in my OPINION they have the best game libaray, great pricing, High Def, an the best online support. You have no fear they are squarly in second and will not be a monopoly.
The funniest part is the third party developers will not allow a monopoly, PS2 was close and look how fast they jumped ship to the 360 so they could support competation.
Do not penalize the 360 cause its made by MS. Its a great system and currenly still an underdog.
PS3, WII and 360 all great systems depends on what type of console player you are.
Currently playing Call of Duty Modern Warfare 2, Fallout 3, Halo ODST and Dragon Age Origins is next game