Some developers believe that Sony might delay the release of its PS3 to as late as 2007. Why would Sony do this? Some analysts believe it would by Sony the time needed to incorporate Blue-Ray DVD technology into the PS3. In which case the PS3 might be the only gaming system with this technology. In the end it would give Sony a good advantage over its competitors.
It appears that Microsoft, which launched Xbox in late 2001 after Sony's PlayStation 2 and Nintendo's GameCube consoles, will be the first company to unleash its next-generation home console. The tentatively codenamed "Xbox 2," set to receive a name revision before its release because Microsoft doesn't want consumers to assume it's inferior to PlayStation 3 based on end numerals, hasn't yet been given an official release date. But just because Microsoft isn't yet talking doesn't mean developers working on early "Xbox 2" development setups are so keen to keep quiet.
A major software company already prototyping software for Microsoft's "Xbox 2" told IGN today that the publisher "definitely aims to launch the console in North America for Christmas 2005." A November time frame was given. A European release will follow in 2006, said the source. IGN contacted another software firm working currently working on "Xbox 2" software, who seconded the news. "Let's put it this way: a lot of developers crunching to get their games ready for a 2005 launch will be really pissed if Microsoft doesn't get it out by then."
News source: ign.com