It would be foolish of MS to put all their eggs in one basket/market.
If they just imitate Nintendo and go all underpowered and casual then it will leave a fairly large hole for a competitor to move into and that could even be the resurgence of Sony ironically.
However I think next gen will be fairly easy for MS to play both fields quiet well. HD will be far cheaper to implement and a GPU that can render Crysis type graphics at 1080p will be relatively cheap in 2-3 years time. Plus it will also be cheaper to implement 1:1 gesture based controls in addition to a standard controller. Nintendo have admitted that Mii Motion Plus was their desired launch control system but it was too expensive. Now only 2 years later that desire is a reality in the form of a cheap add on so imagine what can be done for that price in another 2-3 years.
Microsoft don't have to inovate too much next year, their Live platform is already a market differentiator and software development has always been their forte. Don't aim to please a specific market, aim to be able to please everyone.
Never argue with idiots
They bring you down to their level and then beat you with experience
