Why does that feel too soon to me?

This doesn't really prove much of anything. Epic might be getting the engine ready for 2012 so developers can hit the ground running when the consoles do launch in the future. 

Since consoles are becoming more like specialized PCs every generation that passes, I think the distinction is fading.

Since when have engines been limited to a specific generation of hardware?

The Engine can be ready for the nearly final dev kits "ONLY" for developers.

Like a year and a half before the systems launch.

good effort anyway :P

Sounds to me like this is going to be the first Console specific Unreal engine. While Unreal 3 has performed well on 360 and pretty well on PS3 (after a lot of tweaking) it was, after all, more of a port of the PC engine than anything else.

So I'd imagine it's a case of get the engine ready working closely with MS and Sony (maybe Nintendo) for the new consoles and get it to developers as early as feasible, which could me a year or more before the consoles actually launch, to ideally get as many on Unreal 4 as possible working on launch titles.

I'd imagine they'll either then bring Unreal 4 over to PCs afterwards or produce Unreal 5 specifically for PCs.

So that would mean 2013 maybe 2014 for the next consoles (assuming my assumptions are actually correct).

Depending upon how well ID tech 5 goes when it launches with Rage and of course the new Cryengine with Crysis 2 developers are going to be spoilt for choice for high end middleware optimized for consoles - which is good for development costs.

Your assuming they're going to come out with new consoles because....Unreal Engine 4 is coming out? It's just a new game engine, there's no connection whatsoever. When Crysis 3 engine is released, I think it will coincide with the release of a new Atari Jaguar console.

While I actually have said many times 2012 would be the start of the next generation, your proof is actually more logical if they came out in late 2013 or 2014 as a dev device like this would be used ot build the next games.

However, it could come out as they launch and be utilized on games releasing after launch. Guess we'll see by 2011's E3 if anything new is coming in 2012.

This doesn't really prove much of anything. Epic might be getting the engine ready for 2012 so developers can hit the ground running when the consoles do launch in the future.

Yeah, like I said it... second!

true, it could mean 2014 launch instead because developers nees like 2 years to develope :p