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Well, that makes sense. Microsoft has been profitable for quite some time now so there's no reason to assume a new console would be a money sink.

Also did anyone really expect a 10 year life cicle for any console? Neither Microsoft nor Sony will give Nintendo a 2-3 year headstart. I could see a PS4 release later (like late 2013) since Sony still needs some time to recover enough of the PS3 losses and the NGP release in 2011/2012 will keep them busy.

E3 could get even more interesting now (and Nintendo will be under quite some pressure now haha )