I think this generation is the evolutionary point where games are branching out into numerous paths rather than competing down a single evolutionary line. The audience for games has broadened and changed, and the avenues for reaching gamers have exploded.
Free MMOs have become huge due to very inventive business models (such as the 1/10/89 model of microtransaction in free games). The hardcore may not pay much attention to them but they have millions upon millions of dedicated customers. One called Perfect World has over 50 million subscribed players world wide (It's big in china, thusly the enormous user base. Only 1 million play in the US, and more around the world).
"Casual" gaming has exploded and become common place through the DS, Iphone, Ipod touch, and the home casual console Wii. Revenue from games like Peggle, Chuzzle, bejeweled and countless sudoku, crossword or word games are huge and it's sprouting lucrative genre's the "core" gamer doesn't know or care about, such as the Search Puzzle genre.
Downloadable titles via PSN, Wiiware, and Xboxlive arcade have created an entirely new model of gaming. Smaller games in different genres than you would find on retail discs (giving oldschool a new school feel often times, I won't complain) as well as giving new ways to sell normal retail games.
Flash is becoming alot more viable as a development tool and as more and more business models sprout up, they will get more and more of an audience, and higher and higher quality games.
Steam is a system in and of itself almost. Valve hit the motherload in creating a network only means of distributing games, and a platform to play them on. Backlogs of classic games, a large variety of casual games, and plenty of modern games that are download on demand, often at cheaper prices than retail. It conveniently keeps track and applies patches and updates, has it's own friends list and networking options it's practically the PC gamers XMB.
Traditional disc based "core" gaming on consoles will continue to exist obviously, but numerous other forms are branching out from this single evolutionary line. Many are extremely lucrative, and the influence will be felt across all models. Gaming is changing.
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