For those of you MS fans who say Sony needs to leave the console market...
You couldn't be more idiotic and foolish.
Competition is what drives hardware and software advancements and innovations. Any major company in pretty much every single competitive market on earth will tell you this. Automotive companies, cell phone companies, gaming consoles, computer hardware designers, etc etc etc.
Companies constantly set the benchmarks for one another to break. Without competition, you don't really have a far-reaching goal that must be achieved. You just design what you think will work and go from there. Innovations are made much slower.. etc.
You can look at basically ANY new major advancement when it releases, and you'll see something like "xxx has designed a new xxx to compete against xxx's xxx". I mean seriously. You can look at the new 2011 5.0 Mustang and read in hundreds of magazine articles where Ford has said they produced the new engine to help it better compete against the higher powered Camaro. When MS released the original Xbox, they CLEARLY said they had designed it to help compete against Sony's PS2. If there was no PS2, MS wouldn't have had any benchmark specs to shoot for, and the quality of both the hardware and software would have suffered horribly.
Seriously, do you think that when MS released the slim it has NOTHING to do with what Sony has done with 4 consoles now?
As a die-hard Sony fan, I can honestly say I would be extremely disappointed if MS left the console market. Games like Resistance were created to be Sony's version of Halo. Forza was created to be MS's version of Gran Turismo. Smaller 3rd party software companies wouldn't have the budget to produce games for a single console market, when 2 consoles greatly increases their revenue.
As someone who has been through several years of college, and dabbled in careers in automotive performance, advertising, computer hardware/software engineering, and a plethora of profitable hobbies... I can tell you that competition is what makes the world's economy and technological advancements go round.