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This is no where near as bad as some are making out. He isn't bad mouthing 3DS, he specifies he hasn't seen it. He's saying Sony have looked at the technology and decided it wasn't what they wanted in their next portable device, which as far as I'm concerned is a good thing. It likely means PSP2 will have features to differentiate it from 3DS, and variety in games systems is something I'm all for.

Also, what Hirai says reminds me of what Iwata said in relation to Kinect. Iwata said Nintendo checked out the tech behind that device and turned it down, because they didn't think it would work with their devices and design approach. I don't seem to recall any uproar regarding that. How is this any different?