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I don't think the market would accept retail game price rises, but this has already happened with DLC. You're paying $10 or $20 more to get the full game experience than you would have 5 years ago.

I think we will just see fewer AAA-budget games funded and produced, as the number of copies sold to break even rises. Gaming will focus around a smaller number of top franchises.

Despite the industry rhetoric of demanding higher performance, the remaning series with smaller markets will plateau at the average PS3/360 graphics level, which is still enough to achieve believable realism in the games that need it. Performance is no longer holding back any game idea being fully realised.