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I think people are still thinking about nothing else but sales numbers and are thinking nothing at all about the cost of doing business and how that will affect the next generation.

They keep extrapolating past trends and pushing them forward.

Well the trend for the past generation was for both Sony and Microsoft to not make a dime on selling all that hardware, grabbing all those exclusives and pushing all those shooters and similar games forward.

That model can't be sustained in this generation. People are already feeling the costs creeping up and some of the decisions already mean the jump between generations isn't going to be as large.

Here is how I see the last half of the prior generation. Nintendo fell off the map or took a cut in profits by stopping development for the Wii and ate profits to help push the 3DS out at a price at which it could move units. Sony basically decided to forgo profits by eating them to help move PS3's and get themselves into something other than third place for the generation. I'm pretty sure offering all the older games through PS+ hasn't quite lost them money but hasn't made them money either. Microsoft has continued to bleed money.

Now we are at the beginning of this generation and Nintendo has picked a point where they don't bleed money but don't really make much either. Sony declared their first profit in five years earlier this year but warned that the cost of getting the PS4 out would hurt them. Microsoft again continues to bleed money from Xbox but covers it with other areas.

Others have noted how games are desperate to dive above the $60 mark with exclusive content, microtransactions, DLC, etc. PS+ isn't offering several older used games a month for PS4 because they don't exist yet. Several releases so far have been been better than the prior generation graphically but not any better in terms of actual game play.

However it feels like a massive wall of losses is just waiting out there and on top of it, the prior generation is still working just fine for most while getting cheaper every day.