The problem is that they were still clinging onto the PS2 for dear life, this is bad for both the Japanese devs who are planning to release games on the PS3 and Sony/PS3 in the long run.
You can't start your current gen development without some kind of commitment, there's really no easing into it because your PS2+ product will look like ass.
You can't have a console in Japan basically waiting for these Japanese developers to start releasing their games, everything is about forward momentum, right now current-gen hardware in Japan (not talking about the wii) have no forward momentum, and Japanese developers are waiting for the PS3 to build its userbase in Japan but WTF is the PS3 going to build its userbase on when Japanese developers are still sitting on the sidelines? Even Sony's own producers in Japan are probably trying to look after their own asses by greenlighting more PS2 games from third-party devs working on Sony IPs. Fucking Media Vision ftmfl.
It's like not willing to get on the field until the team starts winning and you have like 3 guys on the field trying hard to win and they can't because you have fucking dudes sitting on the bench not wanting to come on. This is fucking problematic especially for people who have bought consoles expecting to have some fucking games to play rawr. Worst of all in the US you have EXACTLY this situation going on with Sony's own Santa Monica studio adopting this very fucking philosophy making God of War 2 for the PS2, what are third-party publishers supposed to think?