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I think Nintendo will have the 1st place handheld and home console next generation.  I think the industry will become polarised, with Japanese 3rd party developers mainly supporting Nintendo platforms and the PSP2, while Western 3rd parties focussing mainly on the 720/PC/PS4.

I don't expect the level of Nintendo domination we saw in 2007 and much of 2008, but I also don't expect the utter dismissal of the platform by many 3rd parties that we have see and are continuing to see to varying degrees through this gen.

I've said it before and I'll say it again, for the PSP2 to sell more than the 3DS, a miracle/disaster depending on your view has to occur