If Sony is wise, they'll take some pointers on how not to behave from how Nintendo behaved during the N64/PS1 era. And they have repeated an awful lot of Nintendo's mistakes from that era (overconfidence in the fanbase to sell the system over software, alienating third-party developers with difficult hardware, really arrogant PR statements, etc.), as well as adding a few of their own (most notably the price tag being twice that of an entry-level console's price upon launch).
As for the impact on this generation, at this point it would just be damage control. They've lost the edge in the console race for the next 3 or 4 years at the very least. Until new systems start coming out, they're basically stuck fighting for second banana at best.
Sky Render - Sanity is for the weak.
