Yeah, that's what console warriors everywhere don't understand. Three healthy entities competing is much better for the industry than two or especially one. During PS1/PS2 days there was enough competition to keep them honest. We certainly don't want to be going to any situation worse than that one for this gen.
Gaming is not the only ones competiting for free time out there. Gaming companies have to compete with film companies and every other company that provides entertainment to people, because people have limited free time, and the competition in that field is brutal.