If the rumors are indeed true, I'm thinking what Dave Jones said will apply. Those specs may just be from early dev kits that Sony has sent out, but the real PS4 will contain more up to date versions of these parts. I'm sure Sony will have a custom version of the new A8-3850 APU Trinity that is coming out soon. And the GPU will be a further updated version of the HD 7670. Even with the small chance that they are indeed just slightly customized equivalents of what is available now, much more can be done with them when they are running a firmware with a much smaller footprint, as well as specifically coded for those parts.

I expect a decent jump in graphics next gen from MS and Sony.

gameplay experiances, and innovative games is all i care about. as long as PS4 can give me what PS3 can't then i'm all in.

i'm waiting to here how much RAM PS4 will pack. 700mb, or 2G.

Agreed. These specs would still put the ps4 above the ps3 by a good margin, but more importantly the games would still be great even if they don't look like a pc game on ultra settings.

Graphics and gameplay capabilities go hand in hand, new experiences are created through hardware improvements. Creativity will be available no matter the hardware, but a lack of power limits it.

Nope, im just not expecting a tiny Wii like jump from Microsoft and Sony. If Vita is anything to go by Sony is still interested in Powerful hardware. But we will see.

being limited also forces you  to try new ways and new things, so it can boost creativity too as much as not being limited can boost lazyness. I say more than hand on hand it should be a balance, and that balance was kind of rupted this gen. So a little jump in graphics and most of time dedicated to gamplay should bring next gen to a good balance again.

No more likely they will just spend more time on graphics to try and make their games look next gen on the slightly more powerful hardware. 

They will hit the graphics celing sooner tough, there's a limit to what they will be able to do without affecting other aspects of the game, and then they will have to changer their methods and focusing in other aspects. Art style will be the first thing and would probably see less photorealsitic games if it were to happen. Im supposing tough, there's always room for a change of minds even with next gen being a big jump.

^ that's it, if the next gen it's just going to be an improvement in graphics, oh boy... though devs turning his shooters into cod copies to make easy money it's an example of how lazy the industry has become, thrilling and deep rpg's turned into a cheap telenovela with gorgeous graphics and 30 DLC's... i don't want to imagine the next gen.

no they can just other things lol, who needs better AI or more dynamic enviroments when better graphics make for better advertising. If it's harder to differenciate in grphics it will just mean more work is put into it. 

No level of hardware power will force gameplay innovation, but more power does allow developers to do new things like fully dynamic enviroments, more complex AI, larger enviroments, more veriaty in NPCs in any one area etc.