This is disruption at work. Nintendo has seized a market that Sony did not consider relevant, and they're moving upstream now towards Sony's dominant market. If Sony does nothing but flee upstream and support only their existing products, in time they will be left with a very niche slice of the pie, catering largely only to the sorts of people who proclaim the PS3 to be the greatest system ever built. If they respond, they can at least try to keep from losing the upmarket, but this can easily fail if their approach is not disruptive itself.
Given Sony's penchant for sustaining innovation over disruptive innovation in video game systems, it's unlikely that the controller they'll devise will have the kind of impact that the Wii Remote has had. You cannot disrupt by going backwards; you have to abandon the past in favor of the new style. Shoehorning in the disruptive technology onto the sustaining technology doesn't work at drawing in new customers or even keeping existing ones; that's why it's disruptive, after all.
Sky Render - Sanity is for the weak.
