maybe true... but lacking of competition is also bad.... innovation tend to be slower if there is no competition, they could just regurgitate the same things over and over again and can easily be overlook because there is no way to compare it (or contrast) because there is no competition....

without competition if they decide to charge you $800 on a console, hardcore gamers would still buy it... no matter what... because there is less (or no) alternative....

so competition is good for us

I don't see this happening.

Apple is probably going to do gaming too though. They've patented a controller already and likely will bring it alongside Apple TV and some streaming service. If they really come to the market that's some pretty though competition right there.

Competition is good, no doubt. But, there was plenty of competition, very heated competition, between just Nintendo and Sega. Why wouldn't that same high level of competition continue with a two way Nintendo vs. MSony?

If they were to merge, Microsoft will definitely undermine Sony one way or another in the Next-next gen. Its MS's mentality and theyre good at it.

I'm trying to imagine any reason why this would happen.

Both Sony and Microsoft are jumping into the wider ecosystem battle with Google and Apple. The next Xbox will be integral in bringing Microsoft's services to the living room, through their Live accounts and access to Microsoft's app store, as will the next PlayStation be integral in bringing Sony's burgeoning Sony Entertainment Network to that same space.

This is simply not something they would cooperate on.  If they unified under a single hardware platform, they'd still have competing software platforms on those same devices. Working with their own individual hardware leaves open the possibility of one performing better than the other, thus that one having a larger audience to which they can sell their digital content.

It'd be equally as unlikely as Microsoft suddenly working with Apple or Google to produce phones.

Maybe it's really Windows 8 that Sony fears. MS is about to launch a unified OS across all platforms that is rumored to be the heart of the next Xbox. All software and games made for one will work on another, or so the rumors say. If true maybe Sony would rather swim with the current than fight the tide. Sony lost a lot of money on the PS3, right now they have a lot to lose on hardware, but a lot to gain with all their software developers. Maybe they are starting to see the world like Sega and are tired of having to throw money at hardware and hope to make it back in software.

Accomplishments!

Medals!

Eh they can make up whatever else.

dont know how they would work out established franchises i.e. GT and Forza.

Forza GT sounds good.