While I wouldn't agree, I could at least understand someone arguing that Sony would be "the only company producing a next generation console" if they meant that Sony would be the only company producing a conventional console in the next generation; and using the argument that the Wii (and consoles that follow a similar strategy) could not be considered "Next Generation" consoles.
Saying that Nintendo would become a third party publisher is a lot like saying that Apple would abandon producing iPods in order to focus on producing applications for other mobile devices. Its a (remarkably) silly idea because Nintendo could have a "Fall from grace" that is far larger than Sony's (with the PSP and PS3) and, because of their conservative business strategy, they would still be better of financially as a console manufacturer than a third party publisher. While I can't be certain of their strategy, if I was Nintendo I would be looking to make their next generation handheld and consoles be heavily interconnected in ways that consumers desire as a way of "Locking People Into" the Nintendo brand ... and to truely capatalize on this, I suspect Nintendo would need to release a new system.
Microsoft's share holders can (probably) not be happy with the ammount of money "wasted" on the XBox line of products, but Microsoft has seen enough success with the XBox 360 for most of the executives to be encouraged by its performance. Microsoft's main problem with profitability this generation is that their costs were too high (across the board) and there are several steps they can take in the next generation to control costs to see high profitability. Knowing this, it seems unlikely that Microsoft would choose to leave the market when they can see success.
