Well, I agree with part of this. Next gen will see a decrease in sales of HW, but not because the industry is in trouble. It will be because one console will be dominant, while the others will see decent sales. With the PS4 not having a gimped launch like the PS3 ($200 more than the 360 and 1-1 1/2 years late to the party), MS is going to have a large battle on its hands to prove the NeXbox worth the purchase to the people in Japan and the vast majority of EU. They may claim the US again, but I doubt the gap between it and the PS4 will be as much as the gap between the 360 and the PS3 is. The Wii U's fate is pretty much locked. Unless Nintendo does some crazy price cuts soon.
As for one leaving the HW biz, I doubt anyone will. Gaming is all Nintendo does and they have survived low selling consoles before. At the very maximum, I could see them dropping home consoles and sticking with handhelds. Sony's console business isn't in trouble, it's their TV department that's causing most of their problems. So Sony will stick in there, but may drop, or lower, TV production. MS is possibly the only one I could see leaving next gen. If the NeXbox doesn't sell as well as the 360, they may choose to cut the price to create a larger price gap between it and the PS4. This will be bad, as they will already be losing money on every sale, and this would lead to even greater loses. This may cause another outcry from investors to ditch the gaming market and focus on Windows. It just depends on if MS wishes to listen to them or stick it out til the next gen. I assume they will stick it out.
