No way will Sony release a PS4 anytime soon. That would be rediculous anyway. It would be giving the middle finger to people who have loyally supported the PS3, and would leave PS2 owners cold and would drive more of them to the 360.
Sony has made mistakes, and the PS3 is taking hits, but I wouldn't go as far to say things are bleak for the system. Sony has to weather the storm, and next year at this time at $300 with a recovering economy they'll probably do a bit better than the $400 system is doing in a recession right now.
They need to market their system better though; they need a campaign to reinvigorate the image of the system in a way that it can appeal to more than just the tech geeks and hardcore Sony fans. That won't be easy, but if Sony cuts down on the screw ups they can really get out of this quite well. The biggest thing beyond their control is how the market responds to blu-ray. That's still a very open question.
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