It seems obvious now that you mention that, that Sony went with backwards compatibility because Sega released so many systems in the 90s(ish). Immediate support from a lot of Sega fans that felt betrayed. Aaaand the is also a way to stick it to nintendo while doing it. They didnt have to give up the hate of nintendo(i remember sega/nintendo rivalrly every bit as dumb and real as ford/chevy rivalry)

And nintendo ALWAYs making bad medium choices for their games. Ps1 was already black eye to nintendo. Sony gave you mutiple devices in every device. Cds, dvds, blueray. From Sony an already mammoth device manufacturer for those technologies. Man if toshiba or someone had bought nintendo to push new hardware could have been interesting. Nintendo having HD dvd could have been good for n64/gamecube/wii would have very different timeline