If Sony  hadnt released the PS3 then it would have suffered a slow death .Sure ,they could have come up with a Uber Console in 2010 but by then the X360 would have been in the market for 5 years and could come up with something even superior in 2011 .People would then want to buy the X720 as the succesor of the X360 ,the machine that would have been leading since 2005 .The same happens right now with PS2 and PS3 ,but Sony and its high price has shot itself on the foot and PS2 still sells strongly ,plus the massive FUD attack against Sony by some media .

In any case ,PS2 couldnt have lasted for so long as the only console out there .Maybe it can assure some of the lower market ,there are still many games coming and all the casual stuff as Buzz! ,Singstar ,Dance Dance ,Eyetoy and even Guitar Hero.Games for children and little girls as Barbie ,Horsez ,Bratz etc and all in all it covers the full spectrum of games .The PS2 will fight some time for the low-end market and its massive userbase will provide some ground until the PS3 drops its price enough to attract something other than hardcore gamers .

As opposed to having released it and suffering a faster death? Let's see what happens to the gaming division if Blu-Ray is not very successful and they can't drop the price of the PS3...

if they do not release ps3 until 2010, i'd probably continue buying ps2 games and wii games.  i personally do not put wii into same category as ps2 gaming experience.  different games and gameplay.  but by 2010, i think most would have transitioned to 360 already if ps3 was not released.  ps2 would be such an old system that people will stop buying and developers will turn their attention elsewhere.

but why should developers concentrate on another system? none of the new could reach that large userbase of the ps2.

well, i hate to say this, but in a couple more years, price of 360 is sure to drop to an affordable price.  if it drops to around 200 something, im sure more people will buy 360 as opposed to ps2.  if people want graphics, the demand will shift to 360 games, therefore devlopers will concentrate on making more games on that platform, and on the wii due to the new gameplay style.  and as time passes by, developers will gain more skills and with the expertise is making high quality graphic games, ps2 will be limited by its disc space.  it's just a cycle of the business and technology.

PS2 is definitely the best choice right now, not even the PS3 can compete with the 100s of good games on PS2, so I think that the PS2 would have been enough for a few more years, but the PS3 would have been too late to compete if it were release one or 2 years later, so I think Sony's choice is not a mistake just a reaction to the competition.

No, this is a good thing. Even though the PS3 is released you see the sales right? Well where are the gamecube games or the xbox games? Sony's reputation and continuing support to keep the PS2 alive.

To answer the question if graphics matter I would have to say yes. Seriously go to any site that looks at Video games. Look at the preview section. The big thing they look at in previews is graphics. They say stuff like "Man this game looks great" or "this game look terrible".

 The new GTA trailer that was released, it was just a preview of how the graphics look and the shading. Now look at the message boards after that and about 1/3 of the posts is about the graphics. I dunno if I made my point correctly but I think I did.

Yeah, you got it right.

But to awnser the question, I don't think the PS2 would have lived long enough to make more money., It still sells, but how long can it last. Eventually, developers will start to move away as better hardware becomes avalible, and that those PS2 will break(if they haven't already).

Blu Ray is gonna win the format war, just get over it and move on, even Microsoft abandoned the HD DVD by not including it in the 'Elite'.

The PS3 will start selling once there are more big exclusives, 1st or 3rd party: Lair, Heavenly Sword, Metal Gear Solid 4, Ratchet and Clank, FF XIII...