The PlayStation brand is not in any trouble. If it were, then the PSP sales would have plummeted a long time ago. As a matter of fact, the PSP is the only current-gen console that isn't made by Nintendo that's had strong sales throughout all regions.
The only place Sony really messed up with the PS3 is the price. Had it been priced at $299-$399, then the loss of exclusives and delayed European launch would not have mattered very much. Even then, it still not clear whether or not it's a fatal mistake as the PS3 is still outselling the 360 in Japan in Europe, the PS3 still hasn't had a Christmas in Europe, and heavy-hitters are still coming(GTAIV, MGS4, Gran Turismo 5, FF13).
Even if the worst-case scenario were to happen, Sony could easily redeem themselves with the PS4 by making it cheaper and selling the hardware at a profit from the beginning. The PSP2 can be even better if it's sold at a profit to begin with and at a lower price and with some hardware modifications such as a second analog stick.
Consoles owned: Saturn, Dreamcast, PS1, PS2, PSP, DS, PS3
