That's the problem with Sony right now is they lack focus. That's how they lost the multi-billion dollar mp3 market to Apple. Sony OWNED the portable music market with the Walkman brand. But they let is slip right through their hands because they were so busy pushing their music and mini-disc.

I think Sony's in the same position now as Nintendo was with N64. They believe they can do whatever they want and the market will accept it. It's that belief that makes me want Microsoft to knock them down a few pegs, however unlikely. PS3 would be so much better off without Bluray (cheaper, no production problems, much earlier launch). That said, they can more or less get away with it regardless, and if they do establish the leading next gen DVD format, it will be well worth it.

This is all wrong. The supposedly-outdated-in-1983 NES was easily trouncing the Genesis before the SNES launched. When Nintendo seperated their focus between the NES and SNES was when Sega gained a foothold. Nintendo then botched the whole generation by fighting the war on Sega's terms. IE, focusing on "power" and fighting over young teens as the main market. The irony of the SNES/Genesis generation being "the first great console war," is that both companies really flubbed up the whole thing, compared to what they could have done. With N64, it was Nintendo's policies towards third parties that killed them. If you don't know about those, then read up. They were basically trying to control the growth of all third party developers and publishers with a series of illegal monopolizing policies. It was no surprise third parties raced out the door when Sony provided a real alternative (ie, an alternative that had differentiated themselves from Nintendo... Sega hadn't.) The expense of carts cutting into potential profit margins certainly accelerated the exodus, however. Furthermore, Nintendo's main concern is none of the things you mentioned, but rather it is reaching new markets. This isn't PR speak, its literally the new vision and focus that Iwata has brought to the company. Iwata had a great quote something along the lines of "even if we sell the most, we must always fight consumer apathy towards video games." The development community only came back to Nintendo with Gamecube in that it was a generation of multi-platform titles. The system still only had a tiny fraction of PS2's support. GC was by far the best hardware last gen (both cheap and powerful), but it didn't matter in the long run. But right now, you ARE seeing developers budge. Every third party developer and publisher now sees the Wii as an integral part of their long term strategy--this is a stark contrast to GC. The support is obviously not up to PS2 levels yet, where developers' whole livlihood relied on PS2.

The N64 died for various reasons - this was one of them. Technologically, the machine was INFERIOR to the PS1 - and this hurt a lot in the long term. Carts were also too small, and too expensive - CD's stored 10-100x the data, for a fraction of the price. Remember that the PSX was out BEFORE the N64 - not the other way around. It had lots of momentum, but gradually died as developers got fed up with it (hard development, low margins, inferior games).

There is far more to technology than storage capacity ... Nintendo saw the move from 2D into 3D and thought that developers would be looking to produce larger seamless worlds and choose the dramatically higher speed memory cartridge as their format. If you go back and play old N64 games you will find that many of them aged better than similar Playstation games largely because of the cartridge format. Where cartridges failed Nintendo was that they could not hold much full motion video and were too expensive for consumers; this meant that developers could not use misleading advertizing campaigns and consumers would have to pay a priemium for N64 games. Ultimately, the technology wasn't inferior as much as it was the wrong technology for the time.

Nintendo's royalty rates were a big problem, but anybody looking toward the future of the industry was not looking toward carts. A company like Square that wants to make interactive movies needs disc media. This is PR speak. And people talk like it's new. This "it's about the gameplay" nonsense has been Nintendo's excuse for a decade. I haven't seen anybody budge. Maybe somebody will at some point, but all the talk of increased support has been just that... talk. Will it get more support than Cube? Perhaps. Will it get more support than PS3 or 360? I'd say Hell has a better chance of freezing over.