It's money. With the ps2, not only were you buying a ps2, but also a ps1. It costs money to add the hardware onto the next console. Since Sony (idk about ms) loses money on every console sale, having them be backwards compatible as well just adds more lost profit- not only because of having to pay more for the hardware, but because it then made the ps1 completely irrelevant the instant ps2 released. That's my take.