I am of the belief that it will not only be because of game development costs, but of companies having continuous losses. How much do they expect people to pay for a console today? Would anyone buy that $599 console? Perhaps some people, but not a mass of people, will investors continue to tolerate Sony's massive losses (which is why I believe they have refused to drop price on the Vita). If the graphical leap is not as great as some are expecting, the console price will not be as high, meaning a lower retail price and the ability to still earn a profit. Also I am sure in terms of MS they will standardize the Kinect with their next console, something they currently charge $149 for separately, what will that do to the cost of a console? I know Microsoft has buckets of money, but if their focus has become the ultimate reinvention of WebTV they will not need that great a leap to keep that in play.
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