In reality, this would be awful. The price of the console would be outrageous and overpriced. The console and games would be half-assed due to the lack of competition. The competition to win our wallets (not our loyalty) drives these companies to make better games and products, and to be more innovative. If Microsoft never joined the console market, PSN wouldn't have PSN+ (if online multiplayer would be that advanced). If Sony never started making consoles, console gaming may not even be as big as it is today and blue ray wouldn't have taken off. If Nintendo didn't join the console market, motion control/gesture control gaming wouldn't be as big and consoles wouldn't be as innovative.

MS pushed for broadband internet (in 2005, everyone thought this was terrible and despised XBL for requiring it). Things are better for us now.
Sony pushed for blue ray (now everyone uses it, allowed games to be longer and better without multiple discs). Things are better for us now.
Nintendo pushed for gesture controlled gaming (led to the return of the PSEye and Kinect. Both which make the experience easier/better for most). Things are better for us now.

Competition is good for us. This is why MicroSonyTendo would be an awful idea, because there would be zero competition thus driving lack of innovation. Things would be bad for us.

The PlayXii?

pronounced as "Play Crossing"

But I don't think it is likely to happen. Sony and Nintendo already worked together on a project and you probably know how that turned out. Plus Sony wouldn't work with Microsoft when the format was decided which cause the HD/BR war. But they still make MS Computers.

But I think Samsung makes parts for everyone, including Apple. They could combine parts of all of them and make their own 'Galaxy Gaming Media System'

There are other controller design features that Nintendo made popular like the D-pad, shoulder buttons, the thumb-operated control stick, rumble and the diamond shaped face button configuration.  Current controllers made by Sony and MS are likewise influenced by these design features, the SNES controller being the archetype of the moderen day controller.

Scratch off Microsoft, so we don't have DRMs, forced peripherals ending with overpriced console, paywalls everywhere and we can talk.
It wouldn't need MS moneyhat $$$, cause everyone would be developing for it anyway and I don't see any more value from MS for me. Ohh sorry one thing, but I'll settle for the inferior Internet browser and voice commands in my console

Would be a dream come true, sick of wasting money on consoles when I could be spending that money on games! It would also lower development costs heaps which is always good.

I could see Sony and Nintendo joining forces and making a cool console, but I honestly don't see how MS would add to it. They would just make it less efficient, more expensive, and throw in a couple of exclusives. However I don't think anyone would care about Halo 20 when they can play Zelda UHD and The Last of Us 2...

While Sony is busy knocking off Nintendo's successes (Mario Kart, Smash Bros, etc..) and the latter sink in it's spiral of remakes, MS would join forces with Sega, Bethesda, Capcom and 2K to rule all.

http://en.wikipedia.org/wiki/Competition_law

Gives Sega the perfect opportunity to get back into the console business. Squabbles between the 3 companies will lead to bad decisions and a split with lost consumer confidence and Sega shall reign king =D

It already exists. It's the PS4 .. It's a merger of Nintendo innovation and Microsoft internet model and metro UI with achievements to boot. DS4 controller is a beast upgrade from 360, I love it. I'm so happy it has a nice feel to everything. M$ tried to reinvent their bumpers for some God knows why reason. All they needed to do was fix the D-pad. If it wasn't for M$ Trojan horsing that TV input signal, making me have my Xbox on when I want to watch TV and spoiling me with gaming while I watch TV, maybe my PS4 would be on more. M$ you sneaky little bastards..