Financial woes - Did 3rd party Devs create their own monster?

A monopoly is never a good thing in any industry.As Sony prepared to launch its PS3 many moons ago, many devlopers saw them as being on the verge of achieving just that. The PS2 is a resounding success, the full extent of which is yet to be tabulated. For sony to enter another cycle with the support they had for the ps2, would have left many developers having to depend on the policies of a single company. This was not an ideal situation for them.

When sony announced the launch of their $600 baby, they saw their opportunity to level the field. The Xbox 360 had a great launch in the US, and many saw this time as an opportunity to loosen the stranglehold that Sony had on the industry. Decisions were made that raised many eyebrows, which included the exclusive launch of JRPGs on the xbox...in Japan no less.

The intention was clear. Third party devs were intent on creating a power structure that suited them. Where each player in the console market held equal power and where they had more bargaining power

In addition to this, when titles were launched on both consoles, the xbox version was better, with devs claiming difficulties working with the PS3 hardware. Things looked quite bleak for the PS3.

Sensing the opportunity, Microsoft began courting developers like never before. It proved to be a successful strategy for them. Sony, slow to change, continued their practices without fully appreciating the new need to chase publishers, accustomed
instead to it being the other way around.

By the time they did realize this, they had fallen behind, and changes had to be made. They copied the Microsoft strategy of courting and pursuing developers, but they also did something completely different.

While Microsoft closed first party studios, Sony acquired them at an alarming rate. Anyone who has read Machiavelli will know of his distaste for mercenaries. The logic is simple. They have loyalty to only the highest bidder, and to themselves. They hence can abandon you quickly, with very little warning.

In their rise to power, sony depended heavily on 3rd parties, who had now left them in the lurch with 2 recently launched consoles (psp).The troops were rallied around the ps3, while the psp was left in temporary limbo. They clearly had to protect themselves from a repeat.

Sony has since acquired many studios with 2 apparent aims. The first is to wean themselves off the 3rd party dependency. The other was to create games that unequivocally demonstrated the superiority of their hardware and restore its battered reputation. Today, with the first party lineup of 2011 and titles like GOW3 and Uncharted under their belt, sony has achieved this.

Now, with the revitalized 1st party studios in motion, third party devs have lost both reputation and income on the PS3. Their nonchalant attitude in the past has left many ps3 gamers with a "first party first" attitude to their buying habits.
This is eerily similar to the attitudes on Nintendo platforms where 3rd party devs notoriously suffer.

In Short, they created a monster, that monster being Sony first party studios, which they must now compete with to survive. The languishing mutliplat sales on the PS3 for this year indicate that they may be a long way away from being able to do this.