The biggest flaw in the OP's argument is that he doesn't consider the cost of owning the entire platform, including the cost of games and cost of the monitor/TV. In other words, the cost of gaming is NOT just the cost of console/PC rig hardware unless you pirate games and TVs/monitors are given to you by your parents. Once taking into account a gamer who purchases 10-20 games a year over the course of the console's life, the money left over is MORE than enough to upgrade your PC 2-3x over the useful life of the console.
Secondly, it is not required to upgrade your PC that often as it was in the past. For example, a Core i5 2500K/2600K is still a very fast gaming CPU 4 years since it launched. What this tell us is that you only needed to upgrade your graphics card in the last 4 years but the CPU is still plenty fast. There is no need to get more than 8GB of memory for games either, while a solid monitor and PSU will last 7-10 years. PC gamers upgrade their monitor to higher resolution not because they have to but because they want to experience higher graphical details/fidelity.
Thirdly, touching on point #2, I have not lived with my parents since 18. When I moved out to university, I didn't own a TV but I needed a computer for school. I much preferred taking notes in university by hand since science has proven that when you take notes down by hand-writing them, you retain much more information in your lectures. Thus, contrary to the decision made by most students going to college today, I not only saved money by getting a desktop for university work, but I maximized my learning through note taking and listening in class instead of typing on a laptop and missing 95% of the information during the lecture. This point is important because a carefully built desktop PC can be turned into a gaming PC with just a graphics card upgrade. In essence, I now only upgrade my CPU platform with motherboard/memory every 5 years and GPUs more frequently. This lets me minimize my upgrade costs. I resell my old hardware and buy NEW hardware. Even with that, the cost of ownership of new computer parts is rather low because of how well Intel i5/i7 CPUs keep their value. Therefore, for me to game on a console, I'd have to go out and spend $1000-2000 on a good 50-70 inch LCD/Plasma. This adds a tremendous amount of cost to console gaming. I guess if you are < 18 and still live with your parents and you love watching TV, then you already have a TV so you do not consider a TV into the cost of gaming.
Fourthly, the cost of games vs. the PC is staggering. Console games in Canada are now $70, which after tax is nearly $80 CDN. Even if you wait for the game to go on sale, it will NEVER even come close to (1) how quickly games drop in value on the PC and (2) how much of a discount you get on the PC over time. You simply cannot buy new AAA games on PS4/XB1 for $5-15 12-15 months after launch but on the PC this is common. Tomb Raider, Borderlands 2, Darksiders 2, Metro 2033, Batman Arkham games, Witcher 2, BF4, Mirror's Edge, etc. all have already been $5 on the PC.
Furthermore, the argument that console's have a major advantage in terms of exclusives doesn't take into account that PCs also have amazing exclusives specifically in the strategy and MMO genres, as well as the ability to mod games such as Skyrim or STALKER Complete Mod. It's not fair to give bonus points for consoles for their exclusives but ignore customization of games and exclusives on the PC.
The advantage of ease of use and plug and play also is exaggerated. Nothing stops a person from buying a DS4 or XB360/XB1 controller and using Steam Picture on their large TV in the living room. One can also build a small form factor PC with cases not much larger than XB1.
http://www.techspot.com/articles-info/804/images/Image_03S.jpg
I am strongly of the view that for someone who truly enjoys gaming, you should own a PC and a console(s). Simply owning one or the other precludes you from enjoying the best controls/fast movement that PC offers in FPS games, while missing out on consoles prevents you from enjoying some games with your friends as well as console exclusives.
However, strictly from a cost of ownership perspective, ignoring the MASSIVE price disparity of games on the PC is what makes the argument that one should compare a $350-400 console vs. a $350-400 PC worthless. This only works if a person never took finance/accounting and doesn't understand the concept of total ownership cost. If you are comparing the cost of some hobby, you have to take into account the entire cost of gaming. This is where a $1000 PC + $500-1000 in upgrades over 8 years actually doesn't end up costing much more (if at all) vs. a $400 console and $60-70 games. It also doesn't take into account that some PC users wait 1-2 years to pick up a new game much cheaper which also means GPU power has caught up/prices have dropped which allows very cheap upgrades. For instance, in February 2013, NV sold the Titan GPU for $1000. Today you can purchase that level of performance in a $230-250 Radeon R9 290. No one forces anyone to buy cutting edge graphics all the time. There is a smart way to manage your PC upgrades.
Finally, the argument fails to take into account that the graphics and performance of PC games (60 fps+) is just superior in many cases to console gaming when it comes to cross-platform games. As a result it's basically pointless to purchase games like AC Unity or Tomb Raider or Shadow of Mordor on consoles since the PC will provide superior controls, performance and graphics, at a lower cost to purchase the game. Most console gamers just haven't thought about the total cost of owning a console perhaps because they don't get the concept or since they live with their parents where the TV is basically a $0 cost to them.
The business model of consoles is the same one as Gillette razor blades or printers. The hardware doesn't cost a lot upfront but over time, the manufacturer/seller makes $ off what's required to use the original product - razor blades, printer ink cartridges, console games/accessories. And believe me theses costs add up very very fast. With just 10 games at $10 on the PC vs. $30 on consoles, you are looking at $200 saved. That's essentially a brand new Radeon R9 290 that will last 2-3 years.
Right now my Steam library alone has 101 games, and it shows that I spent $205 CDN on all of them. I have many major games from STALKER to Assassin's Creed to Metro to BF, Crysis, Trine, etc. It's because there are so many promotions for free PC games or free PC games with new GPUs. If you buy 7-10 games on consoles you'll easily hit $200. There is no comparison.
