This "cloud thing - "let's use the world to calculate where to the bullets fly in my game" is just marketing talk. I'm sure people with bandwidth caps / slow internet speeds / high ping rates will be very happy to hear that their games will be 10 fps in the future/shut down within a few hours/whatnot.
There was/is a (more or less confirmed, apparently) rumour that MS is 6 months behind schedule in the software department and no amount of "bbbbbut look I can switch from tv to game within 2 seconds" is going to help them here. it will be interesting to see what happens when both consoles start to sell. This time, there is no 12-15 month advantage, no price advantage, apparently no developer friendlier tools advantage. And yes, the gpu disadvantage will show up in non-lazy developer's work..
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