Considering the situation, we assume this might be interpreted as good news by both gamers and developers.
According to a report on a Japanese website, as translated in the Beyond3D forums , it seems Sony has halted their plans for the next generation of consoles. For now, they're putting it on hold for a couple of reasons: firstly, so the PS3 can remain as relevant as possible for as long as possible, and secondly, because they put a lot of stock in the PSP2, and see the industry shifting in the portable/mobile direction. Apparently, Sony was working on a "PowerPC-based system at IBM Rochester after the Larrabee fallout," but they won't be immediately pursuing that. If any of this is true, game designers and publishers will likely breathe a sigh of relief; the vast majority have gone on record saying they hope the next generation is a ways off. Many have only recently come to terms with the PS3's complex hardware and Sony only recently started to turn a profit on the machine.
Perhaps this report has been sparked by the latter fact: Sony's game division posted a 135% rise in the third quarter, thanks to "significant cost reductions" and "higher unit sales of PS3 software." So maybe they're looking forward to the future as the PS3 continues to bring in much-needed profit. For our part, we can do without the PS4 for…oh, years.