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Words Of Wisdom said:
Most people here are making good points however...

The real point that people keep talking about is that one of the biggest reasons costs are high because things like graphics are costly.

People here are assuming that graphics will continue to be so costly which strikes me as odd. As tools grow and improve, the overhead in making better graphics will decrease. Perhaps topnotch graphics are not cost-effective on a wide scale this generation, but in the future that may very well change.

There is a finite limit to graphical improvements - the human eye.  Even 1080p is hitting that barrier now...

 Companies like Sony and MS only understand how to add in more power when they make a system, as the tech continues to advance, you may not get massive leaps in graphics, but costs inherent in programming the games would continue to rise gen after gen as games got larger and systems got harder to program for



 

Predictions:Sales of Wii Fit will surpass the combined sales of the Grand Theft Auto franchiseLifetime sales of Wii will surpass the combined sales of the entire Playstation family of consoles by 12/31/2015 Wii hardware sales will surpass the total hardware sales of the PS2 by 12/31/2010 Wii will have 50% marketshare or more by the end of 2008 (I was wrong!!  It was a little over 48% only)Wii will surpass 45 Million in lifetime sales by the end of 2008 (I was wrong!!  Nintendo Financials showed it fell slightly short of 45 million shipped by end of 2008)Wii will surpass 80 Million in lifetime sales by the end of 2009 (I was wrong!! Wii didn't even get to 70 Million)