MS, Sony, and Nintendo make the majority of their money from 3rd party licenses. They only make 1st party exclusives to ensure customers buy their hardware for their exclusives. Then once the device in in the home they make a killing on anything else published for it.

Dumping hardware would mean far less profit.

Probably because all three companies have different agendas on how to develop their console brands? Like how Microsoft's after the "Entertainment device" thingum. Also there's the divergence in gameplay with 360's Kinect, Sony's PSMove and Wii and Wii U's WiiMote and GamePad. Different companies want to pursue different methods of gaming using different hardware, so it seems a little impossible to reconcile all these... Plus if there's really going to be a "unified" console for Sony, Microsoft and Nintendo at the same time, who's going to actually be in charge for it? And how would the profits be split?

Besides, the industry isn't exactly in a stage whereby manufacturing hardware isn't economically viable anymore, so it's still profitable, so why not?

Are you sure about this? Seems like MS is making a killing on third party then since they seem to sell the most, they also make a lot of money through Gold subscription whereas Sony seems to lose money even if they sell almost as much third party as MS.

There just seems to be too many problems to this. It seems to me making a single box opens a can of worms we might not be ready for. 

Take a look at cell phones.  Cell phones are the opposite direction of where your idea came from.  Cell phones started out in mind of wireless communication.  From that idea came Samsung, Nokia, LG, HTC, Motorola, Apple, Sony, Microsoft, etc... 

And look how great that ended up.  A new apple Iphone every year with cost up to $500. 

Now let's apply that with Consoles.  This years model of the Box is featuring dot, dot, dot, dot.  Well, so many manufacturers are producing the same box, but of course Nokia is starting to get into the box selling business as well.  Why not, if each box is standard, then why not LG get into it, too.  Now that all Devs are making games for any system.

Then Apple sees the big pie, and as an edge, next years model is the I-console.  It does everything different from what console does now.  Why not charge people $500 dollars for this model.  Hell, devs don't care, they games still get sold.  Then next year, because Samsung can't get left behind, they create the Galaxy console.  They're expecting us to pay $599 for this model. 

Now, these brand new console makers try to up-end their customers by having console specific games.  They're not developing the games, but game devs are being paid extra to make it exclusive.  Why not, how else do you stand out from other console makers.  

There will be trade-ins, and upgrades, and contracts, and console commercial, after console commercial, after phone commercial, after console commercial.  Pimping out the game devs games.  

All culminating to World Console War like we've never seen it before. 

"Apple is the better Console maker."

"No, Samsung's console is better."

"You LG fanboy.  LG has nothing on this year's model of the I-console."

Point to the scenario above is that, while it would be great to house all developers, there's no such thing as no competition.  In an open sea, there are always going to be sharks.   

One thing that the three have in common is the controller which third party can focus on if they don't want to develop for a specific control scheme. If Nintendo, Sony or MS want to release some new way of controlling, nothing would stop third parties from selling their games only through Sony channel so it can use Move.

If Nintendo, Sony or MS wants to make a console then nothing would prevent them from doing so as most gaming would be streamed  but companies like Samsung, Panasonic, Dynex (yep even them), Toshiba etc would be able to release consoles too. It's more like a dvd player that has access to gaming... it'd be a bit like that Ouya thing for Android games except it would play any games through any channels as long as you subscribe.

I like things just the way they are with the Big 3

Ill be really disappointed if one of them leaves the hardware business or someone else joins

Well, each company has their own business models and strategies, but the whole reason for producing a console is to make money on all games sold on it.

Same thing, new name. It's great for xbox 360 owners that have gold anyway, but I don't think it will wow many others into buying a subscription. Unless you mean gaika / on-live type system which has it's own set of problems.

Nintendo, Sony, Apple, Microsoft and all the big software companies deciding on 1 console standard is not going to happen. Look how long it took the dvd consortium hell bend on not repeating the Betamax, VHS, Video 2000 war. And they still couldn't get to 1 standard. We had the hd-dvd, blu-ray format war forcing both to be rushed out of the gate. Players that couldn't be updated became obsolete, pissing off consumers, and many losses were made trying to wow people into their camp with 7+ free movie deals and selling exclusive movies at a loss. Thanks to a dedicated gaming console taking a huge loss, this war luckily didn't last too long.

A gaika / on-live type service might work in the future and there is no reason it can't run on all consoles just like Netflix. Although if Sony goes on with Gaika, why would MS let it on their system instead of offering their own alternative. There is more money to be made from a walled garden and MS is more actively working towards that goal then an open standard.

Yes services are the future, but your own services. Get the subsidized hardware into peoples hand and make money by selling them your services.

I am heavily against this.

yes. exclusives are the only way to get the most out of a system.