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I don't believe that people really require for innovation to be pleased. So many of the biggest games this generation are simply re-skinned and technologically improved versions of games from years ago. Be it Mario or Call of Duty, consumers are more than ecstatic to play a new installments in those series, even if they have been playing the franchise for plenty of years already. Don't get me wrong, I'm not trying to downplay innovation as an insignificant factor. It can be important sometimes. My point is innovation is not required, and sometimes not even requested, by consumers. The consumer loves same old experiences, oftentimes more than innovation. In fact, I'm surprised Nintendo is saying this as they have benefited from this consumer mentality for over a decade.

I do agree with him about graphics though. I do not believe we will see a huge jump in the graphical standard next generation. Of course, this is just my own prediction of the future. I think as long as graphics look clean, consumers won't be so caring about the improvements. I agree with the user above whom said we will be seeing diminished returns on graphics. I know when I see PC games with top notch graphics, I don't really care much. Yeah, it does look very realistic, but that doesn't make current generation games unbearable for me. In fact, it doesn't affect gameplay at all for me. It's because current gen games reached the point where they look clean, more than clean. And any graphical prowess higher than this point is where I believe you start seeing diminishing returns.

Also, the image in the OP really shows how ugly the Gamecube was. Every other console had one dimension that was small to make it have a rectangular surface. But not the Gamecube, that had to be shaped like a cube. What the Hell was Nintendo thinking? Nobody wants a ugly ass cube in their living room. If a company tried to released a cube-shaped console now, consumers would mock them into oblivion. You know what...I'm going to make an assessment, and you can quote me on this. The reason the Gamecube sold so little is because of its shape. If it wasn't shaped like a cube, it would have sold double, maybe triple, as many units as it actually did.