Console sales don't drop off when a company releases the successor to their console, they drop off when someone releases a new console which cannibalizes the sales of their console.
Now just because Nintendo or Microsoft release a new console doesn't mean that their current consoles will see sales fall to 0 quickly, and it's likely that the PS3 would see its sales hit because newer/cooler systems with more processing power and fancy features had been released; and if these new consoles are released at a reasonable price ($300 to $400) and the PS3 is still fairly expensive ($250+) their release could have a very negative impact on the sales of the PS3.
In this environment where the wind is taken out of the sales off all current generation consoles due to the release of next generation consoles, it will be difficult for the PS3 to outsell the XBox 360 by 8 Million units unless Microsoft mishandles the release of their next system.
