Sony did suffer from pride, but it was a pride in their craftsmanship that bordered on artistic arrogance. The reality is that Sony has treated its engineers like sports superstars or celebrities, and to be honest about it engineers aren't the most pragmatic of people. Basically they were so consumed with trying to create perfection. That they rarely even bothered to consider whether the design was practical, or that it was something consumers really wanted. Sure this is the kind of thinking that made Sony into a powerhouse in the past.

In a stand alone world over engineering electronics equates to quality in the eyes of consumers, but doing so in a world that is cross connected. Where consumers accept day one obsolescence, and are thus highly conscious about price points. Such a design philosophy is a pure eye sore. People don't want to waste the money on a piece of art. When they are just going to replace it in two years anyway.

That isn't to say there isn't a market for over engineered goods, but that market isn't super sized by any stretch of the imagination. The point being that the pride wasn't so much in themselves. As it was in the products that they were creating. I am not even sure that Sony understands this. Firing employees, and moving the manufacturing out to other markets. Won't fundamentally change the fact that they are using a hundred pieces when ten will do almost as well. The problem wasn't on the factory floor. It was in the design specifications.

yes don't know why people keep saying you need sony to make consoles,when i started it was BBC's,spectrums,commodores,atari even amstrads lol,

people come and go but there is always nintendo

@Kynes and Kowenicki

Care to explain. How big is financial services. Since how long they have been doing it ?

PS is more than 10yrs old. 300+ million consoles sold already. How is it comparison to gaming. I think Financial services is free money for them which they obviously will like to continue.

Gaming and entertainment is what Sony cares about most and so do millions for PS gamers :)

PS3 is only 6yrs 70million, next 5 yrs I think they will easily go past 120million. So much still left where as other consoles are already done and dusted.

PS4 ans also with cloud gaming they are going to set new standard in console gaming again.

120 million? I dont think so. 

Wait, for most gamers the main benefit is not from having the opportunity of buying and playing on 3 different consoles, but from stronger competition. Three players, with the 3rd not too little, means no one can become strong enough to act as a near monopolist.
A totally different fact is that it's not necessary that a player be Sony, although the PS brand has become so universally known for gaming that should Sony go bankrupt, it would make sense for the new 3rd competitor to take over the PS brand and Sony strongest 1st parties at the liquidation sale.

About hubris, not always, alas: Intel kept the leadership also during the 6 years when Athlon was stronger than Pentium on desktops by "persuading" most manufacturers, retailers and technical magazines to downplay the rival, and it also managed to lure Compaq into killing Alpha, the most powerful CPU of its era it had obtained taking over DEC, and selling its tech for future versions for just one billion to Intel itself, boasting an inexistent superiority of the not yet released Itanium, that actually turned out to be a miserable failure, it took Itanium 2 a complete redesign and some more years to eventually beat Alpha after the latter's development had been already stopped.

"next 5 yrs I think they will easily go past 120million "  <-- [ SONY make.believe ] ....... u seriously think this is even possible ?

Agree. 100-105M in 3.5-5 years is possible, but after that, reaching 120M, if possible before sales crawl to a halt, will require some more years, not less than another 3. So we're talking about 120M, if ever possible, in at least 6.5 years, unless they receive a significant boost from emerging markets.

You singled out one statement but missed the point it was leading to:  there is so much more gaming content out there that our time and money are more taxed than ever before.  There IS far more competition and that's part of my point.  And for the record, I'm not predicting a bankrupt Sony (which doesn't mean the end of the world, as Marvel Comics was bankrupt 16 years ago and look where they are now).  Sony Playstation may end up being a more Playstation Mobile service company available on multiple screens and less of a gaming hardware manufacturer.  That makes more sense than anything to me, especially in light of the Gaikai purchase.  But that would be, as I stated before, a traditional console market of only 2 players due to an inability to support 3 players anymore.

Hubris is always self-defeating.  Always.  Wait ...

You're right about portable consoles market not being able to support more than 2 competitors, but home consoles one can support 3 competitors: it actually grew a lot during 7th gen compared to 6th gen, and it's still growing, with the 3rd already almost three times as big as 6th gen's second. If Sony is in trouble is not due to the market not being large enough, but due to its own errors, accepting too high initial losses for excessive self-confidence (yes, here your hubris point applies perfectly) and currently due to other divisions' and product categories troubles. And now, other portable devices will bring trouble to portable consoles market, but there's no sign that other devices will kill or shrink home consoles soon, it's instead more likely that if XB720 and PS4 will have enough multimedia and general purpose computing features, they'll grab a larger slice of home theatre, home computing and set-top box markets than XB360 and PS3 were able to do. What can be considered dead in home consoles market, thanks to the experience gathered from PS3 troubles, is the use of excessively exotic HW. If wanting to deliver something original and different, Sony and MS will follow Nintendo's approach, using off-the-shelf components and choosing new tech only when it becomes mature and cheap enough and combining and using it in original ways.
This doesn't rule out the possibility of Sony going bankrupt, but should it happen it would make sense for some industry giant to take over its whole gaming division, and replace Sony in the market keeping the PS brand.
About others taking other the other Sony divisions, it must also be considered that a consistent part of current Sony troubles and scarce ability to compete in mid and low end segments of markets like TVs and phones comes from unfavourable currency exchange rates, so, while Sony cannot for some reasons do it easily, and can only cut some costs with the joint venture with Panasonic, a new owner of its divisions could solve this problem transferring a larger part of production from Japan to China and other countries, at least for the whole share of production to be sold where the exchange rate is giving more troubles.
About Sony keeping its gaming division, but becoming 3rd party-only for other platforms, it would mean stopping gathering royalties from 3rd party games running on its platforms and instead paying royalties to others. This MUST be taken into account before deciding, and Sony can't put an excessively negative weight on remaining a 1st party, a console producer, due to the mistakes and excessive costs that damaged PS3, because those mistakes and crazy expenses must NOT happen again. Also, Sony is already a 3rd party for PC and Adroid, PC has a free marketplace, while Android has marketplaces with transaction-charged apps, but Google didn't impose its exclusivity, so marketplaces compete and Sony can even run its own, gathering fees instead of paying them.

One final point: if PS4 launch was scheduled for either 2013 or 2014, then a large part of the initial investments has already been made, so not launching it at all would mean throwing all that money away without any hope to ever recover it. OTOH, accepting 3rd place next gen (if there isn't the possibility to do better), but being very careful to reach profitability early will make PS4 a viable product (Nintendo philosophy, but realesing later to be able to offer more for the same launch price, or even a higher price, but within the first sweet spot verified on the market for consoles, $399, the price at which PS3 stopped having big troubles selling when it was still new).


But hey, we just have to wait some more months to know for sure.  If Sony already decided to stop producing consoles, we won't hear anything about new ones, but if a new console was already planned within a 2 years term, then it can't be stopped without losing a huge part of the investments, so Sony will have only one choice: releasing it, but doing things right. No errors allowed now, that's why Sony will better not rush a launch in 2013, unless it was already planned for that year.

I still think, though, that the best chance for Sony would be to be taken over by  some Japanese giant healthy or not in big troubles, for example Mitsubishi or Sumitomo, or even Kawasaki.

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