I wonder how much functionality Switch will have beyond gaming. I'm sure we will get the netflix, youtube etc but wonder if it will have much beyond this.

Yes, so? If I stopped drinking energy drinks it would be bad for Rockstar. Where is your point?

If people stop playing console then that means console as a means of entertainment are lacking. So they should have reduced sales. Would be bad if they didn't.

What would there be beyond it? It's a dedicated gaming console. Note the word dedicated.

NiN sure seems to think so. Everything you read about Switch says NiN isn't waiting and is pushing hard to get the Switch out asap. Not before proper software is ready though of course.

I can totally see PS thinking about coming out with a PS4Portable. PS right now is pushing out hardware like madmen, and its all linked to the PS4, so a portable that plays down scaled PS4 games definitely could work.

PS likes to compete on all fronts, so Switch being a new type of hardware, will no doubt be tempting for PS to try and emulate, especially if the concept takes off.

This would be bad for Playstation too ... because why even buy the "Sony tablet", people would more likely IMO buy the Samsung or Apple or Google models, just like most people won't touch a Sony phone today. 

Right now the dilenation between devices is good for Sony, because people look at the Playstation and say "well you have to buy that to play Madden and GTA on your TV", but if that thinking starts to shift in consumers, then you have a problem even for Sony. If people start to realize their tablet can now also basically function like a console, it's going to be one less reason to buy a dedicated console. 

MS is already a big player in the tablet space. Wouldn't be hard for them to have a Xbox Surface tablet gimmick...

I've kinda thought about that yeah, an XBox Surface with snap on controllers would make a lot of sense for them. 

Depends. If the "take your console games on the go" trend takes off, PS could be losing existing or future PS4 customers to NiN. Worst case scenario, PS just makes an upgraded tablet that has controllers attached and brands it PS because it can play PS4 games on the go. As long as PS is keeping those cutomers happy with hardware, they will keep buying PS games, putting money in their pockets, which is all that matters at the end of the day. Sure it costs money to develop, but PS already does consoles and handhelds and tablets, and keeping customers is quite important if they are buying someone elses product/games instead.

It all comes down to how hot of an item is Switch going to be?

The issue is the competetion wouldn't just be the Switch. You're look at it through the narrow prism of traditional console wars. 

The problem is when players like Google and Samsung and maybe even Apple start saying "hey ... this is not a bad idea, lets try it". That's where you get into trouble, because people will then say "oh ok, my iPad already does this, I can play real Madden NFL on my tablet already". 

These mobile chips are getting better and better every year, soon enough they will be able to match/exceed a PS4, and sure PS5 will be a good deal better than that, but at what point do you reach a level in graphics where really it's good enough for most people. I think PS4 level is that cut off. 

The "big box under the TV" concept of console gaming might start eroding for sure. 

I was talking more about the next year or two. You are correct. MS or Samsung or Apple etc, could in fact do the same tablet thing eventually.

You have to ask yourself though, why would NiN, completely drop dedicated consoles, and go this route? If the scenario you suggest was likely, NiN would be crazy to make just a hybrid, because truly, it's more of a handheld tablet than a console. Meaning NiN could lose the little market share it has now in the console space. The fact that NiN is doing this, says to me, they are worried about the existing gaming competition, and not companies like Apple and Samsung.

Mobile gamimg no doubt is taking away from the home console space, but there will always be those people who don't care about gaming on the go, and who want the best tech can offer right now, and mobile will never be able to meet that need. Unless companies like PS and XB eventually decide for business purposes to go all mobile, then you won't have a choice.