Sony marketing team are horsing genius.
With respect to MS and Nintendo, innovation is a difficult area. The automobile was a left field innovation when people wanted a faster horse. However, Nintendo and Microsoft really hurt themselves with price and the proportionate value proposition. Mr. Yamauchi always stated that hardware was an obstacle to get to the software. He was stating this when talking about the GCN's price.
MS adds unnecessary stuff, and Nintendo brings out the gamepad, which, at this point, could probably be considered as a non-required peripheral (provided they changed the required parts about the online infrastructure).
I wonder how this console, priced at $250 out of the gate, named Wii 2, with a pro controller that retained the mic and gyroscope functionality would have sold. The initial problems would have remained, but with units flying off of the shelves, third parties might have remained on board.