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ironman said:

I don't know that next gen will see MS or Nintendo making a console that matches the raw power of the PS3. 


I find this view suprising:

I think the N6 will probably be about 2 - 2.5x as the PS3 and the 720 will be about 3.5 - 4x as much.

There will be no doubt that next gen will see significant leaps in power, just look at the DS - 3DS jump.  The emphasis will be on keeping costs down, and that can still be done with a console which is a graphical powerhouse, Nintendo made a profit (albeit a small one) with every Gamecube sold at launch at £149, and that was amazingly powerful for it's time.