Really, what I see if MS was to hang on and beat Sony in Europe or others, then you would see some EU company or UK company try to come out with its own console. I think Sony or Namco or Sega or someone else would try to release a console to try to reach the Asian market if Sony decided not to release a dedicated console next time, the 360 would win America in the next gen, and much like this gen Nintendo would win worldwide because of the fact that they have characters that are popular in all regions.
So Nintendo would win worldwide and still compete in America (but I think they would come in second to MS' next console there), another European company would enter the picture in Europe and there might be several companies vying for second place spoils to Nintendo in Asia. Asian gaming would become much more insular. I don't know if an EU developed console could gain any real footing in the Americas.
Basically it could become much like the time when they had all those microcomputers competing in different territories and they usually didn't appear in other territories like the days of the C-64 in America, MSX in Japan and Spectrum, and Amstrad (I think in Europe).
But what would that do for high budget gaming? Certainly, Nintendo and MS games would still be well supported; however, if you liked all those little Japanese games that were so good yet introduced to American only because of the popularity of the PS2, then you might be disappointed that you wouldn't be getting too many of those.
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