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Pemalite said:

Great.
So we have established that the Playstation 4 originally sold on the premise of:
* More power.

The Playstation 4 Pro is essentially sold on the premise of:
* More power.

Ergo, power is an essential selling point to a large swathe of gamers who desire better fidelity, happy we can agree.

I disagree, the jump in geometric and lighting complexity is rather impressive.

2011 is roughly the year that you would compare Xbox 360 game releases to releases today on the Xbox One.
And that is also the year of Battlefield 3, Gears of War 3, Halo: Anniversary. - Compare that to titles coming out today and the difference can be rather startling.

Now I don't know about you... But running Battlefield 3 on the Xbox 360 makes me want to poke my eyes out with a fork, where-as Battlefield 5 on my Xbox One X or PC looks like to be in another league entirely... The fact it's not running at 720P is a massive massive advantage that improves clarity.

Development costs do continue to rise... But so do profits.
More power doesn't automatically equate to larger development costs anyway, some improvements in graphics actually reduces development time.

For example, having dynamic lighting in-engine takes far less time than designing all the individual textures with baked lighting details in it, which was a common practice during the 7th gen due to lack of power.

I personally have no issue with higher development costs anyway... That isn't really our problem, they can simply make games with smaller budgets.

To an extent, yes. However, my point is that power is no longer the sole aspect consoles can sell themselves on. PS4 sold well because it had a ton of other selling points that mattered far more than just how powerful it was (which BTW, for being the most powerful system at the time, the PS4 really wasn't that powerful. It was just playing catch up to what PCs were doing for a few years by that point). PS4 Pro sold itself on better visuals alone, and yet the base system still regularly outsells it by quite a margin. Granted, the Pro was always meant to be a niche product, but it still proves my point that you can no longer use power as the sole, or even the main selling point anymore. Yeah, that stuff is important still, but increasingly less now due to diminishing returns. 

I agree that this gen was a noticeable step up from previous generation, I never said it was a small bump. However, the improvements weren't as significant as past gens IMO. The biggest things that improved was better lighting, facial expressions/textures, and more detailed open worlds. While several current gen games are made better by more powerful hardware, most of the improvements can again, be traced back to finally having adequate RAM and CPUs that aren't heavily customized garbage. I've seen footage of Battlefield 3 vs Battlefield 1 and yes, it looks noticeably better, but not by a massive margin. Keep in mind, I've never cared about the subtle nuances of graphics to begin with, so things like resolution, textures, etc might be noticeable to a more hardcore gamer, but to someone who doesn't care about that, they probably won't notice a difference. 

"Development costs do continue to rise... But so do profits.

More power doesn't automatically equate to larger development costs anyway, some improvements in graphics actually reduces development time.

For example, having dynamic lighting in-engine takes far less time than designing all the individual textures with baked lighting details in it, which was a common practice during the 7th gen due to lack of power."

I especially agree with this. I don't think games in general are harder to make now. If anything, they're actually easier to make than ever these days thanks to simple hardware and wide engine support for all consoles. I think gamers really overestimate how expensive game development generally is today. That said, I was specifically referring to AAA game development, which continues to rise due to ever increasing audience expectations for these games. We're seeing AAA games take longer to make now because of that. 

For your lighting example, I certainly agree with you that new rendering tools and techniques can help with development, especially for smaller developers. But I'd say that has more to do with the architecture and engine support of today's console than RAW power. Simply because it's easier to employ these graphical techniques on hardware your already familiar with vs some heavily customized processor that makes doing those same tricks just as time consuming as the old fashioned way.