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Developing a game without updated tools, while you have a limited budget and working on a compressed schedule to meet a hard deadline will rarely result in the most advanced games.

The main exception I can think of is Star Wars Rogue Squadron 2. This title was particularly visually strong because Factor 5 was approached ahead of the Gamecube's initial reveal to generate a tech demo using their Rogue Squadron engine, and the tools received substantial updates prior to beginning development of the game.