yushire said:
You are into something here, but for backward compatability to succeed, you still must use the current technology to make the games backward compatible. Just like the Wii was a gimped gamecube the reason why it can also play gc cds without emulation.
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The heart of Wii is a less than 1Ghz PowerPC CPU, while XBox 360 already had in 2005 a 3,2GHz tri-core PowerPC CPU. GPUs capable of HD without struggling are still quite expensive, but will be cheap in less than three years.
So already in four years Nintendo could get, say, a 3GHz or more quad-core PowerPC with more than 12 times the processing power of Wii's CPU at bargain prices: having enough power for HD and keeping BC shouldn't be difficult.