Regardless of what Sony does right now the PS3 will (probably) have sold less than 8 Million consoles by January 1st 2008 and less than 10 Million consoles by March 31st 2008. Whether you are a Sony fan or not you have to accept that publishers are public companies which have to worry about their bottom line. As a result most publishers will be trying to figure out ways to improve the probability of the games that are currently under development being profitable, and reduce their exposure to the PS3.

The risk the PS3 faces is that every publisher decides to overcompensate for their early ignoring of the Wii and diverts most/all of their resources towards Wii development ...

I did put casual in quotes as I know that many of the Wii owners are not just casual gamers.  Hell I would only consider one of my friends a casual Wii owner as most also have a 360 and two have the PS3 as well.  I do think is fair to say the Wii has thwe most of the casual gamers compared to the 360 and PS3.  Same way you can say most hardcore gamers probably lean towards a 360 or PS3. The Wii has a better price point then both and has many games that appeal to more casual gamers while the 360 and PS3 have more hardcore games etc.  Also I don't usually refer to Wii, 360, PS3 players as I go by gamers and lump them all in.  Sorry if you have an issue with me quoting casual but I am pretty sure your in the minority thinking that people think Wii owners are mainly casual so I didn't think it was something I had to explain.  In terms of your PS3 example my cousin has hardly played his PS3 and currently doesn't even have a game.  I guess that is just my experience. 

I am kind of cheap... I would prefer to be able to sell my PS2 hardware and use the games I already have and love on a PS3 rather than having to keep my PS2 to play them.  I'm already 1 short on inputs on my TV since I have a satellite dish, DVD player, Wii, PS2, and 360 plugged in.  I have to unplug one to play the other... I sure as heck don't want to add another without eliminating something...  I also want to see the PS2 games "upscaled" at some point as I have seen numerous reports that some of the PS2 titles look significantly better when upscaled on the PS3... 

I'm going to go ahead and trade in my ps2 hardware this weekend since gamestop is running a special.  If the "low cost" PS3 doesn't have backward compatibility, that will delay my purchase even further... 

View some of your old PS2 games upscaled to 720p or 1080p and you'll change your mind about wanting to continue to play them on a PS2 after you've dropped $400+ on a PS3.

^^ you both make a good point kn and rocketpig, since I don´t have a HDTV and play my 360 on a PC Monitor I never thought about upscaling much but it does seem to be a great feature, if I was thinking about getting a PS3 right now I would need backwards compatibility since the PS2 library would in a way compensate for the current lack of games.

Psychologically speaking, your mind will change greatly after dropping $400+ on a PS3 regardless of what the games look like. 

Hahaha, true. Mine mostly serves as a PS2 upscaler sans rumble.

The mind reels at Sony's blunders after awhile...

But Home will save everythiiiiiiiiiiiiiiing! Riiiiiiiiidge RACER!

Ah yes, HOME, the last stand of the PS3 it would seem.

^
It is way too early to assume that the PS3 is on its "last stand". We will have a better idea this time next year. Then maybe we can make "last stand" posts then.

^^ I don´t think she was beeing serious, it´s just that many "PS3 domination" belivers have named games or projects like Home as a fixed date of the beginning of "the Storm", nobody credible thinks the PS3 is doomed but thinking it can dominate the way the PS2 did is just absurd at this point as well. BTW welcome to VGchartz :)