Sony, colaberated with Nintendo before launching a console of its own. And lets face it Sega was in the toilet the moment it launched the 32x and sega CD. That their software continued to suck also helped Sony get control of the market. Nintendo for its part will never leave the gaming industry and I never said it would, I could see them abbandoning the home console market and going strickly handheld had things turned out different for the Wii. Their business strategy as you stated being the way it is proved that they are the king of innovation by expanding and controlling the market once again.
The fact of the matter is Sony was not totally oblivious to the console market they knew they had a good thing and they ran with it. They inovated the market and changed the way video games are played by adding (and doing correctly) CG cutscenes and storylines. As others have stated and I agree with them the only way a new company can successfully compete is with an assload of cash (Microsoft) or by inovating the market. Since Nintendo just accomplished the latter and very few companies have financial credentials that compare with MS, I don't see anyone stepping up to fill in the spot.
