It's an ok analogy, it makes his point, but not very well.
The gap between movie theatre and DVD is huge, the gap between PS3 and 360 isn't. In fact, we haven't really seen a gap as of yet. Not to mention the fact that the films that are better in movie theatres are often flashy effects movies with little substance and that if it doesn't translate to the small screen then it is a film with limited merit. Not something you would want to compare the PS3 to if you were talking about it in complimentary terms.
Graphics and power wise a better analogy is that the 360 and PS3 are HD-DVD/Blu-ray and the Wii is DVD. However that completely ignores the Wiimote which is an integral part of the Wii.
The analogy doesn't fit future sales trends. Although if it did then Sony would be in trouble, most movies don't attract enough customers and they don't make a profit. However tv has far more potential customers and can have a better profit margin.
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