All he's saying it won't be a transition like to the PS3 where developers were having troubles with the cell processor. And that is to be expected, MS have a solid SDK that developers are pretty happy with, so they'll very likely just be adding on to it more graphical and processing power and not changing much of the internal architecture.
What is interesting though will be the fact that developers will probably also have the option of built in more accurate kinect support next gen as a secondary control option, and also probably some sort of tablet control as a tertiary control. All this besides the primary controller. Now that to me is very exciting since it opens up a tremendous amount of options for developers to experiment and innovate with.
