It's pretty simple-minded to see "innovation" as only being possible in the technical sphere.
Sony's real innovations in the gaming medium are almost all business related.
Put simply, Sony (and Ken Kutaragi) intended from before they even had a working PS1 to change most of the established facts about the gaming business: manufacturing, licensing, accessability to developers and the public image of the medium from "toy" to something more in line with music or film. That's also why SCEI was originally organized under Sony Music, rather than one of the technical divisions.
They also succeeded, and in doing so basically created the current gaming industry.
Their current "innovation"? The way they treat "indies" on their platforms as a pretty clear attempt to bring back (manyfold) the PS1 era of smaller teams doing high ambition games.
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