Sony Sega'd themselves with the PSP.

The original was almost ingenious: the PS2's simple triangle-throwing GPU with an obscene fillrate, plus optical media for gigabytes of storage. Unfortunately they weren't clever enough to swap the laser assembly for like an LED and an optical-mouse sensor, so it was fragile and complicated and sucked power. More importantly - they made everyone buy their overpriced flash-media format, the Memory Stick.

Then they released another model that forced everyone to buy a different overpriced Memory Stick. Then they released an upgrade that forced everyone to buy yet another model of Memory Stick. Then they ditched the optical drive, fully screwing over customers who'd put up with all of that shit, and amassed some library of legitimate games.

The Vita was like the Dreamcast: being good didn't matter. Customers and developers alike simply were not interested. The trust was gone, and the ecosystem did not develop.

Sony's real fuckup was not embracing PS VR. Yeah, it was kind of a gimmick, but it was their gimmick. They stumbled into a massive share of a niche market for expensive gizmos. Sony, of all companies, should've leapt at that on instinct. Instead they let the VR revival dwindle, with early PC adopters burned by Oculus selling out to fucking Facebook, and the PS5 having no follow-up headset. It effortlessly could have been their thing. They had the money to gobble up second- and third-party studios, desperately seeking "exclusives." All of those could have had 3D TV support, for the giant virtual television you should obviously get from any non-VR PS5 game.

Anyway - they have PS5 VR headset now, but the momentum is gone. It doesn't even work with the VR games they already fucking had. Sony, of all companies, should know exactly what backwards compatibility is worth, as both a number and a narrative.