I actually don't think more competition = better industry. This one of those phrases that's just thrown around without any thought put behind it.
The industry is so fragile that having too many players in the field is a bad thing.
You NEED two solid game companies to push the industry ... it's not like Sony acted crazy when they were competing against mainly Nintendo in the 1990s and early 2000s. The industry was healthy then.
But three ... I really question if the game business needs three major console manufacturers. Is the game industry really better off with two (basically) carbon copy players in Sony + MS and Nintendo being pushed out to make cell phone games or something? On top of Sega basically being gone?
I say no.
Nintendo was more competetive with the core market in the 1990s because they had a core audience to cater to. With MS entering, all MS has done is oversaturate the field so much that Nintendo opts to take a more casual approach, and MS still can't beat Sony, so what's the point? They don't need the game industry, and while they were busy chasing the game audience, they took their eye off the real threats to their main OS business -- Apple and Google.
