Wii shortages will start to tail off mid-year due to increased supply. By year's end, the Wii will have had it's first price cut (or add value to the package) and will be in striking distance of 45 million total units.
The 360 will see a price cut within 30 days of the release of GTA4. The price of the Premium Unit will hit at least $299, maybe as low as $250. If the price cut is moderate ($50), another will hit for the holidays. This will spur sales and push the 360 over 25 million by the end of the year. It still will have no traction in Japan.
The PS3 will maintin the current price point for most of the year, and be happy to bask in the "it doesn't suck anymore!" vibe until the holidays. Sales will generally continue their upward trend, closing the 360 gap thanks to Japan. Will end the year with 21-22 million units, more if the holiday price cut is steep.
In order to redden Nintendo's blue ocean, MS and Sony will make a strong effort to appeal to "casual" gamers, but with minimal success.
Super Smash Bros Brawl will be the best selling SINGLE CONSOLE game of the generation after WiiSports and WiiPlay (mutiplatform titles, like GTA4 or Madden may beat it in combined sales).
WiiFit sales will shut up many of its "hardcore gamer" critics.
GTA4 will be a disappointment, due to high expectations and perceived lack of innovation. Still it will be a very solid game with strong sales. Will end up selling more on the 360 than the PS3.
MGS4 will have great reviews but disappointing sales on the PS3 (under 2 m) and a 360 version will be announced by E3.
E3 will be better in all ways. Facilities will be better for attendees, and each company will aim at making a bigger splash than in 2007. Expect lots of new title announcements, and fewer clips of people playing Wii. There won't be a runaway winner (unless you count gamers).
Nintendo will release a headset and chat capabilities for the Wii by spring, most likely coinciding with Brawl or Mario Kart.
Killzone 2 will have as much an impact on the PS3 as did Heavenly Sword and Lair. No one will be talking about it in 12 months.
Nintendo will release a Wii Hard Drive, which will spur criticisms from gamers for it's high price and limited memory.
No hard release date will be given for RE5. Rumors persist that it will not land on consoles until 2010.
Capcom will announce more Resident Evil for the Wii.
Banjo-Kazooie 3 will prove that Rare's simply lost the magic of the N64 days.
Nintendo will announce Pikmin, FZero and Kid Icarus for the Wii, but the megaton blast will be WiiDogs for the holidays.
Sonic and Mario will get at least one more team up.
Zack and Wiki 2 will be announced.
Many video games will be released based on major motion pictures. Almost all will suck.
Paramount and Dreamworks will not renew their HD-DVD exclusivity deals with Toshiba, signaling the end of the HD format wars in 2009.
The first $199 BluRay player will be released.
No matter who wins the presidential primaries (prediction: Obama for the Dems, McCain for the GOP in a convention floor battle), none of them will defend video games as an entertainment medium with the right to make adult-oriented software. Expect Halo3, GTA4 and Manhunt 2 to figure prominantly in new debates over video game violence. In covering the debate news programs will continue to use old footage of Doom and Mortal Kombat.
The 2008 Game of the Year isn't on anyone's radar right now.
Former Senator Mitchell will release a report suggesting that video gamers really ought to consider taking some steroids.
