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"It's always been about graphics driving gameplay."

There isn't "some truth" to that, it's absolutely and completely correct. The evolution of gameplay has always hinged upon what is visually possible to create on a screen. Historically, whenever gameplay has bogged down, such as when every other game used to be a 2D platformer or a beat 'em up, it wasn't until graphics advanced that new types of gameplay emerged.

Also, the idea that there is nothing at all between blockbuster titles and facebook/mobile games is absurd. Downloadable titles are the new "middle" and they're doing pretty well.