Elementary my dear leo-j
I'll answer in terms of MS, because in Sony's case it would actually be slightly under 4 years, so perhaps I misspoke slightly.
*MS employs their hardware staff on a permanent basis. To do otherwise would involve too much hassle trying to find good hardware deisgners every 5 years.
*MS will not pay people to not do work
*Threfore I submit to you that the day after the xbox was completed, work was started on the 360. The day after the 360 was completed, work started on the 720.
*Obviously, the last 6-8 months before a console's release, it is undergoing testing, and being manufactured, which is not the responsibility of the designers. AThey must therefore be doing something else
Work started in earnest on the 720 6-8 months before the release of the 360
Work started in earnest on the PS4 6-8 months before the release of the PS3
Work started in earnest on the Wii2 6-8 months before the release of the Wii
Obviously, some very basic planning would have started months or years before that. But that would only be very general concepts like 'Hey, we should push online/graphics/accesability+price with our next console"
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