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It was due to the fact that it wasn't a solid agreement...in 1991 Nintendo broke Partnership with Sony and signed a contract with Philips. Later Sony sued Nintendo, but due to vague partnership contracts by the time Nintendo got off clean and tried to sue Sony claiming to own some of the concepts to the standalone console sony was planning on developing including the name 'PlayStation' but the judge denied legal action. That being said to the person who previously answered your question (Nintendo rightly realized it was too good for sony) ;). Nintendo and Sony both created the playstation and they would've made an amazing joint company if they stuck with each other.

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