From the perspective of market share they aren't but from the perspective of 'did I make money doing this?' Microsoft takes probably >70% of the profit shared between these 3. They are supported by the Apple effect whereby people willing to pay more for a service or access also tend to pay more in the marketplace so it is a win/win and Microsoft supported this themselves saying they made as much money from the market place as they did from Live subs alone. Their service evolves faster because they have to continually justify themselves as being better than 'free'.

Im trying to understand what you are saying here. You do agree that neither Sony or Nintendo has any meaningful presence in the living room with services that have potential to "own" the living room in the future, correct?

Because Soleron described above how not even Microsoft (or even Apple!) has a very strong potential to become present in the livingroom (apart from being a gaming device).

That's the thing. The article assumes that only MS and Apple have somewhat of a chance to some day become the media hub that connects the living room together and provides the consumer with all the media he needs, be it TV, movies or games, to the point where he doesn't even need a cable TV provider anymore. Sony and Nintendo aren't even mentioned becuase they simply have no chance, and they might not even have the ambition to own the living room.

Sony, Nintendo, Roku, Apple, Microsoft etc all have a reasonable chunk of market share and none of them dominate over any other as set top boxes for streaming content. So from the perspective of market share or market penetration you can't write them off. The Wii and PS3 are both significant sources for streaming content for people in the living room and by ignoring them and seeing everything as an Apple vs Microsoft problem is stupid but you can understand this myopia as it is an Apple fan blog.

The thing which Microsoft dominates is content sales and Live subscriptions for their own content, I.E. they are the only company making serious money in the TV space and the other players are merely bit players by comparison if you count revenue and profitability. This doesn't mean that they will continue to dominate but they have the money to seriously evolve their service to make it extremely compelling.

Nintendo and Sony definitely have a chance in the living room as the Wii U has the ability to control the TV and it can act as an excellent remote control and Sony has a strong background in multimedia as they own some of the largest music and movie publishers in the business. It takes far too many assumptions to make the leap that Apple will overtake Nintendo and Sony whilst Microsoft will maintain their position to make it into a two way battle when Apple hasn't made any real progress with their Apple TV unlike their other products.