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Microsoft has decided they want to take over the game-console industry... not for the income per se (they actually lost money on each Xbox console sold in the first few years, something they could afford to do to buy market share), but because everyone who buys a game console has one less reason to buy a computer running Windows. And by getting into the hardware business, they're keeping the likes of HP, Dell, and Gateway (who rely on them for Windows) on edge. Sales have been disappointing, but Microsoft is determined to "own" this market as well... if they can.
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The Sony PlayStation is an incredibly popular and powerful system, with by far the largest selection of games available. The expandability of the PS3 means it can do a lot more than just run game software (something Microsoft is reluctant to let the Xbox do, because that would undermine the "need" for Windows), and can even play CDs and DVDs. The portable PSP is in a class Microsoft doesn't even offer.
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Nintendo has been producing computerised game machines for decades, and between the Wii (which has revolutionized the gaming industry with its interactive controllers), the portable high-tech Nintendo DS (which also features educational titles), and and their still-popular older models like the Gamecube and the ruggedly pocketable Game Boy, they have systems for most budgets and for even the most tech-hungry gamers.
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Although Apple's Mac computers are far better - and better supported - gaming systems than many people realize, the company studiously steered clear of the game market... until the iPod Touch and iPad. These give you access to thousands of games available on the Apple App Store, using the devices internal motion sensors to turn the whole thing into a game controller.
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With high-end game machines trying to be a "real computers", why not just use... a real computer? Computers can run more kinds of games, and because of the hefty royalties that Sony and Nintendo charge console-game developers, there are more people producing games for computers. If you already have a reasonably powerful system, you can spend the money you'd put into a dedicated console on gameware instead. (And keep in mind that "real computer" doesn't have to mean "Windows computer"; there are games for a lot of other operating systems as well.)
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If you can live without state-of-the-art technology, you can save a small fortune by buying one of the older consoles and games for it, secondhand. You can chose from earlier systems from one of the current industry leaders (Sony's PS2 or PS one; Nintendo's N64, SNES, or NES), one of the worthy systems to fall by the wayside in the past decade (Sega, Atari, 3DO, SNK NeoGeo), or "classic" systems from the 1980's (TurboGrafx, Vectrex, Coleco, Intellivision, Odyssey2, Atari 5200/2600) for some nostalgic fun.
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my personal selection