Now many people are predicting Playstation 4 domination this gen, and with the sheer specs of the machine who can blame them. Allow me to point out some potential obstacles that could actually hamper PS4 if Sony continue to show the incompetence they showed with PS3 launch and Vita.

Pricing
Sony have to find some kind of balance here, price it too high and you have PS3 launch all over again. Dont forget PS3 launched during more prosperous times, so if Wii U is struggling to sell (and its not uber expensive) dont expect people to instantly drop their money on a more expensive machine. Wii U sales have proven PS360 are still a force to be reckoned with as well, and both these cheaper machines will have the same effect on PS4.
Price it too low, then expect big losses right out of the gate, yes it might fly off the shelves but if Wii U makes profit on a couple of software units sold, how many games will have to be sold for Sony to break even.

Software dev costs
Tell me..how many devs and studios went bust last gen trying to chase the HD dream? I imagine with the higher specs on offer dev costs are only going to soar even higher. These potential higher dev costs may ( and this is only a speculative guess) ramp up software prices to a ridiculous price. Imagine..an uber expensive console with expensive games, not an attractive proposition to someone who doesnt have money to burn, or even a cheap console that you cant afford games for.
This isnt a thread to bash PS4, and some of my observations are not factual and speculative, but what are your thoughts?

No one console will dominate the upcoming gen~

no. you are wrong. PS4 is god's avatar. It will never fail. Please, change "PS4" to WiiU or NextBox

PS4 will probably be cheaper than ps3 (launch) and i don't see the problem with the dev cost, since apparently games on the highest ps settings already look loke "next gen" so consoles will just get the ps version not much will change.

And no i don't expect ps4 to domminate. Actually i expect it to do similar numbers to the ps3

I think Sony are very aware pricing is a big reason why they didn't well at the start of the 7th gen and will price the PS4 at $/€ 450 or lower.

I don't expect dev cost to see a huge bump. Contrary to last time in the 7th to 8th gen transition the way games are created won't change much and devs already are used to high quality asset creation and multithreaded programming and there are many different engines with powerful tools to assist them.

There are no obstacles believe me, so far its doing everything right. The price will not be 599. Dev costs will not increase significantly, this has been said by so many devs.

I disagree that cost of developing games is going to be one of the two big issues. Developers have been making graphically intensive games on the PC for a long time. The reason that early PS3 games were expensive, delayed, and graphically worse than their 360 counterparts is because the PS3 was different to program for due to the cell. The PS4 is powerful, but fairly standard.

1) Analysts Predictions - around the PS3 launch, Sony had 2 successful consoles under it's belt, and the PSP was assumed to be doing fine with just a slow launch. Nintendo was producing a sequel to a 21 million seller and MS was producing a sequel to a 24 million seller. Analysts all assumed that the PS3 would dominate, and that meant that 3rd parties were willing to support it.

Now, Sony has 2 successes and 3 'failures' under their belt (and please don't bite my head off about the term failure, I know that PSP and PS3 have done reasonably well for themselves, and I am sure PSV will do just as well), Nintendo is releasing the sequel to a 100 million selling console, and by PS3 launch time it will be having great hardware sales. MS is releasing the sequel to a ~80 million selling console.

Devs aren't going to rely on Sony until Sony can give them a reason to.

2) Price of hardware. We all know Sony is in deep, deep trouble financially. PS3 is not making them the same easy money that the PS2 was, and the rest of the company is struggling. The gaming division cannot use the "it's alright for us to lose money, we're helping establish blu ray over hd dvd." argument. Sony will not take a huge hit on hardware price this generation like they did last generation. The PS4 will cost a lot for consumers at launch.

the Vita will

lack of marketing (unlikely)
lack of launch titles (hardly matters)
price (likely)
competition from 720 (likely)
720 cheaper price (likely)
more 3rd party support for 720 (unlikely)

I know for a fact Wii U won't be the problem.