If you only take realistic visuals into account, then yes... at one point it will hit a wall, wich is when it perfectly mirrors reality. But, the beauty of a virtual world is you can make it look however you like, so in that regard, creativity is the only barrier.

It's crazy to think people thought this would be a 5 year generation.  It just isn't going to happen 

Well, NX is rumored to release 2016.

This. Photorealism is the big goal and the technological side will advance together with new techniques for designing.

People who are saying that we're now close to it don't know what they're talking about. Currently we can't even get high level graphics on 4k. The next steps are still higher resolution, advanced lighting, advanced physics and all of that with very high and stable fps.. Those things aren't even rendered in fps today, they still have fph(frames per hour).

The next 10 years alone will be a big challenge for hardware manufacturers and designers.

edit: whoops double post.

Doesnt matter if its not much stronger than the PS4.

Its just a "late" comer to the party, more than a new gen.

I made a thread :D

http://gamrconnect.vgchartz.com/thread.php?id=210256&page=1

I mean remember were dealing with sprites 25 years ago
now look how far we've come
in another 25 iwonder how much progress is possible
hardware capapbilities will make crazy leaps in the next 20 years , look how much leaps theyve made in the past 20
ithink we'll definetly peak in 10

No. The ceiling will most likely be CGI level of detail. But that will take a lot longer to run all that, in real time. I think only than people will say that's it. Because there is a ton of systems that aren't in games. Real time cloth simulation. Complete layers of shirts, underwear, and pants are all free on the model, that colide. Stuff that rips etc. Bone muscle system, realistic gravity, real skin. Environments that can be destroyed anyway you can think of. The ability to have fully modeled people. So in COD 205, guts and stuff will properly be blown out. Or Walking dead could be realistically done. Lip sync. Things like that.

I love this answer; I personally think that the chase for photorealism, while it is both cool and an important part of the industry in some ways, is and will be only one part of the equation and that focus will lie elsewhere for the most part.
We're already seeing a resurrection of the hunt for brilliant gameplay above all in modern Indie titles and there is even a proven market for it, I think developers, especially smaller ones, will go various routes and ways towards the total gaming experience.

Input and immersion, like I said, will be the main focus overall in the next decade or so, that's my belief anyway.
Oh, and better AI would be much appreciated...