I understand what you're saying, but the problem is that the CEO always decides that X division of a company must try something that will benefit Y and Z divisions, which might not necessarily be in the best interests of X division. And yes, technically there's nothing saying this will occur 100% of the time -- but that's just the way big companies work. If you have a bunch of divisions working independently just trying to do their own thing, you don't have a big company, you have a bunch of smaller companies. To really drive this point home, what happens when division X wants to do something to their benefit, which might negatively impact divsions Y and Z? You wouldn't allow that if you were the CEO or sitting on the board, so division X would not achieve its full potential.

The PS2 and PS3 are great examples of how collaboration with your other divisions can help you in some cases (PS2) and hurt you in others (PS3).

 I disagree, I would say my second one is the most likely to come true, the first one hinges on whether Nintendo continues to support the Wii fit balance board (which I believe they will) with further software, if they do then there is no real upper limit for it.  The third one depends on how much supply they can get out in the next three years, i'm expecting a major rampup late next year followed by other rampups over the next two years to meet the continued demand.

i think your third is more possible than not, but do you really think sales will continue at its current rate for the next 7 years? i doubt the wii will still be in production at that time, im guessing nintendo would have released a new system by then. especially with the rate at which technology is moving at the moment, wii may become outdated way before that date anyway. your first is just impossible in my eyes, im sorry! 30+million wiifit boards wont happen! they would have to release a huge amount of games for it, and even then it would get too repetitive in my opinion.

To pass 250 million by end of 2015 Wii would only need to sell about 29 million a year for the next eight years, very doable, as for demand of Wii who is to say how much demand for the Wii there is.  Hardware has never decided a console war my friend, if it had PS2 would have lost and DS would be losing, Wii can easily have a nine-ten year lifespan, especially if sales continue, Why would nintendo need to release a new console unless sales slow down.

As for Wii fit, no a huge amount of games wouldn't be necessary, a few yoga games, a few martial arts games, a few training at high intensity games, etc. and you're there

fair enough, i under estimated the wii at launch so i could be wrong about this. but i still think its not possible.

 See again you comparing apples to oranges, as Bod stated this is what Nintendo does, this is there spine so to say. So from YOUR point of view your looking for "innovative" software, which is fine :) nothing wrong with that at all. But don't assume that innovative = greatness, as stated Sony is a Hardware company, a Movie producer, etc. What's say the customer wants a great entertainment system to be the center of there living room? My PS2 played games, dvd's, and had digital audio output to my surround. Nessesary? Not by any stretch of the word, but I will say it was definately a deciding factor of where to put my money.

I buy a console based on functionality, it's a known fact that EVERY console will have more than it's fair share of GREAT games, it's the nature of the beast, however if you ONLY consider "great" to be innovative, then your in for a great dissapointment, I try to keep an open mind and see past a games controls, now the Wii is a fine console no doubt, but aside from gaming I have no real use for it. And as an "entertainment system" that's simply not good enough for me.

So I'm going to agree with bod, it's definately possible to create something as revolutionary as Nintendo, it's just not a necessity, but the possibility is definately there. Hell Sony helped get the ball rolling for CD's on consoles :P which has saved all markets TONS on production costs over the years.

In the end a Sony/MS combination would be ideal. Sony has cutting edge consumer electronic skills. The best designers of hardware and internal tech . (the PS3 internals are a piece of art, the 360 apparently looks like a shitty PC case. see RRoD). Also the media capabilities of Sony are superior.
MS has better software skills (see better xbox live, more features of the OS, better developer support).
Nintendo has the advantage of being faster. They changed their tactics completely and are hugely successful. But they need to continue innovating else the greater capabilities and resources in execution of MS and Sony will overtake them.

 Convergence is brought up every few years, it never succeeds, once upon a time it was believed that one PC would control your entire house and everything in it, instead today we have a lot of different appliances and gadgets each with their own chips, this one will be the same, discs are a dying format, digital delivery is the future, so these all in one systems are going to end up obsolete

Well your point might be valid if were talking about (all home applications). The PS3 is regarded as a phenomenal Blu-ray player, has HDMI 1.3, plays games, music, web browser, etc (to many damn things). All of it is fully functional should you decide it that way.

Many people like simplicity (notice iPod), hell it's almost impossible for me to find a cell phone that doesn't have MP3, Camera, bathroom sink, etc etc etc. Are there better for each? Certainly! But who wants to keep all that stuff on them? The fact that I can have one unit connected to my tv and receiver is a MAJOR plus for me, it makes things VERY simple, I really do think it's an issue with Sony pushing too much tech to fast, honestly there are way better DVD players out there than the PS2, but how many people played DVD's on it? Countless amounts.

It's not a very successful plan yet, but I do believe SONY needs to hammer out what there entertainment system can do for your household, understanding the value of the PS3 is a major benefit in the decision to purchase one in my opinion. The only MAJOR obstacle for Sony at the moment is for them to make the general public realize that the "Playstation" is more than just a game console lol. Hell could you imagine a standalone Blu-ray player that let you find audio/video/picture's through your local network, let you browse the internet, upscaled your DVD's, let you store up to 40 Gigs of data, etc etc. For 399 bucks? It's just the fault of the name I suppose, but oh well, I definitely use the features :D