I don't think Sony is going to die. No way. But I still think that Nintendo has done quite a good job in this round of consoles.
As any marketing or business development book will tell you, once a product type reaches a certain level, the products converge to fit the desires of the users. Other than a few games, the Gamecube was not what it needed to be. Without Nintendo's extreme level of customer loyalty there may have never been a Wii, but they built an amazing fan base.
Now they've done the one thing that consumer's base decisions on at this product stage - differentiation. They have truly differentiated themselves.
The next round of consoles, either 4 years down the line of 10 years down the line, depending on whether we believe Microsoft or Sony more, will likely see more differences. The other consoles with adopt Nintendo's strategy and pick up the motion sensing abilities (oh wait - it'll be there within this round. Can you say peripherals and firmware updates?).
$250 is a pretty sweet price too.