Uraeus on 29 August 2010
The advantage of consoles, compared to PCs, is that game developers have a fixed target and can thus optimize for that target and know it just works on all units out there. So it wouldn't make sense for Microsoft (or Sony or Nintendo) to upgrade their systems mid-generation as it would just risk bringing in the same kind of issues keeping people from PC gaming. For instance old games might start behaving wrongly due to the new system specs or new games might be targetted at the faster newer box and thus owners of the older versions get a bad experience.
