Consoles won't die per se, I think they'll be replaced by something more "PC like". Like the 'steam boxes' we're seeing where they are turnkey gaming consoles made by any one of a myriad of manufacturers.
Either that or Sony/Microsoft will make their consoles upgradeable because who wants to be stuck with the same junk for 7-10 years when technology is moving so fast?
I think Nintendo would survive this just by virtue of them doing things differently