Sony has stated that it made the decision to remove backwards compatibility from the PS4 due to manufacturing issues, stating that it would have been difficult in the long run.
The news comes after Sony also revealed that they thought long and hard about deciding to remove the ability to play PS3 games - a decision that they ended up also making with the PS3.
"We decided to focus on the 'positive aspects' of switching to X86." said Mark Cerny when speaking to Japanese publication AV Watch. "If a different architecture had been selected, it probably would have been even more problematic. The X86 architecture is well known and development is relatively easy."
With the PlayStation 3, the initial batch of consoles had an Emotion Engine chip build into the hardware. For the European launch, this was swapped out in favour of the cheaper "Graphics Syntheizer" GPU that emulated the PS2's architecture. However, after an initial run, Sony decided to remove backwards compatibility entirely.
In the same interview, Masayaso Ito stated that a similar situation would have had to happen with the PS4 - it would have needed to include the CELL processor chip. He states that while that would be fine in the short-term, as a long-term solution, it's not viable.
"We can freely manufacture CELL if the decision is made that it's needed. However, that's not the case with supporting hardware. There are parts that will become difficult to obtain."
From the interview, it can be gleaned that the decision was not an easy one for Sony. However, with the company's current financial frailties, it makes sense for them to take a cheaper option from a manufacturing perspective. From a developer's perspective, Ito also comments that "using this opportunity [removing backwards compatibility], we decided to stop going down this path, and, as Mark said, to focus our efforts on simplifying developer efforts."
Backwards compatibility has been around for quite some time, with the Atari 7800 able to play most Atari 2600 games. However, it was dropped from most major consoles until the release of the PlayStation 2. Since then, the majority of Nintendo's consoles have included the option, while the Xbox 360 can play most of the original Xbox's library through software emulation.
Source: AV Watch