Console Market not contracting, becoming more focused

[Louie]

I'd put it this way: Console gaming is moving upmarket. This is neither good nor bad, but it has a few consequences:
- Smaller number of total customers
- Higher profit on a per customer basis (because upmarket users are willing to pay premium prices)
- Higher profits in the short term for incumbent companies
- Overshooting (gaming is becoming too expensive / complicated for certain market segments)
- A higher risk of being disrupted in the future ( = another Wii generation in which a "bad" console sells lots of units and Sony / Microsoft lose a lot of money, or disruption by tablets and smartphones)

This has positive and negative sides, so I wouldn't want to judge if it's good or bad. It's just the way it is and it's the direction most established markets go.