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greenmedic88 said:

I find myself favoring the 5 year hardware cycle, even at the expense of extreme upgrades to specs. And no, I don't mind buying a new console every 5 years assuming they don't rise exponentially in cost with each subsequent release, which won't happen because of the way the console consumer base is structured.

At this point, no consumer should realistically expect proprietary "black magic" technology (and the massive R&D this requires) that resets the standards each generation. All that manufacturers really have to do is take advantage of advances and developments in fabrications processes, ICs, memory, cost adjustments, etc. of the time to update designs with the appropriate customizations to suit their target needs. 

I'm fairly certain the days of expecting manufacturers to dump their products at a significant loss are over which does favor a hardware cycle in which manufacturers aren't locked into a X year requirement in production before hardware cost losses can be recouperated. 

Nintendo has actually had that flexibility for generations; the only reason the Wii lasted as long as it did was due to its early success. Notice how quickly the Wii U is wrapping up its product life cycle by comparison. Nintendo sold it at a profit from launch so the key losses to their bottom line were to the brand (due to low sales) and consumer perception that they are abandoning a platform too early (four years) due in large to the unusual length of the 7th gen. Consumers got a lot of mileage out of 7th gen consoles by comparison, particularly those who were early adopters. 

Notice how current console designs are more like a cross between desktop PCs and mobile devices; their designs can be significantly and continually upgraded utilizing advances in the previously mentioned areas without having to start with a clean sheet of paper. 

Again, I would point to Nintendo to show how they have been reusing existing designs with upgrades and updates without resorting to that blank slate hardware architecture approach. 

While the lengthy development pipeline for certain games is certainly a factor, this is nothing new. It's no different than developing a game with a projected 3 year development pipeline for a console that is in its 3rd or 4th year of market availability. Would any publisher realistically finance such a project without having a contingency plan that included adopting/porting their game for an as of yet not existent future console? Of course not. 

The lenghty pipeline is something new, since the last generation. PS2 games were made with 50 developers and two or three years. Also mind that it isn't always possible to start developing so early, because you need dev kits to do real progress and that won't arrive that early. Porting to a next gen is feasible, but you would end up with games that look midway trough generations (like MGS5).

For the bolded part, I believe that this could even end up eliminating console generations. No more retro-compatibility problems, new units each 2 or 3 years. Each unit keeps receiving games for 7 or 8 years.