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That's pretty much the same reasoning as thismeintiel's. People will jump on better graphics, $400 isn't too high, third parties will drive hardware sales. Also, did you forget that the PSV's launch lineup was superior to the PSP's?

You are pretty much banking on the idea that improved graphics will make people shell out significantly more money to play largely the same content. You bring up CoD as an eye candy title when hardcore gamers complain that Activision has been using the same engine for years, yet the masses kept buying the games, because they didn't mind the graphics. You bring up FIFA and Madden when it's clear that the PS4 won't launch in August/September where the vast majority of these games' sales happen. The third party games you mentioned won't drive hardware sales in the initial year and it's going to take cheaper consoles to make people buy into the next generation.

The PSP did not have a memory card problem and also had a huge 3rd party game in Grand Theft Auto that came out about 6 months later (which i think was annoucned for E3 2005 only 2month ish after the PSP launch in NA, so that had an anctipited game to look for.  Also it was a brand new handheld offered by Sony, offered multimedia functions that were not available at the time (without buying multiple devices) and was riding the success of the PS2, completely different from the Vita today.

While the overall gameplay of call of duty has remain fairly unchanged, im sure if you were to pop in a copy of COD3 from 2006 and COD BO2 from last year, you would see a clear difference in graphics (there is even subtle differences between the Wii U version and the PS360), im sure with new hardware they will show clear differences and that would be enough to move hardware.

Madden 06 had a 55% attach rate for the 360 the year it was launch in the US, which was several months after the PS2 and Xbox versions, pretty much used the same PS2 engine (but better graphics and had less features than the PS2 and Xbox) and cost 10 dollars more.  If it looks better than current consoles, games like Fifa and madden will help sell systems (as they already shown)

Rumors abound that Microsoft especially (since they have the program in place already), but I can see Sony doing it also, plan on offering a subsidy for their next gen console through their respective online services.  While this would eat into current gen sales (Sony keeps the PS3 at current prices), this could eliminate the 400 dollar console problem.