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PS2 support dropped.  Linux support dropped.  It's dropping more features than it's adding.  All that's left is blu ray.  There are some exclusives I am interested, but I don't really have time for all the good Wii games not to mention 360 games.

When the PS3 came out I was interested in it and planned to get it eventually, but I have lost interest and so I'm less likely to buy it now even if the price drops than I was several years ago.

Dead, no...  However it's not likely to go beyond third place...