yes i believe we do. however each future gen will probably get longer and longer.

this gen will last another 4-5 years most likely

expect future gens to last 10 years at least

Hardware wise we need much more. This gen is nearing 5 years old. By hardware standards ALL these consoles are old tech. I got more than enough playtime out of my $400 xbox. Im ready to spend another $400 on a new console next gen. Just give me some awesome new specs.

but it's not that simple, the closest thing to that I know about would be the DSi and that did require a redesign and the number of non DSi ware games that can use the improved hardware can be counted on one hand, additional changing the hardware can break some games if they aren't careful with the design. It's not like the just order a different parts and chuck them into the old hardware, even die shrinks that you see on the ps360 requires a lot of testing and firmware updates. And all three console manufacturers are designing their next gen consoles and have been since this gen launched maybe even before.

Well, the PSP 2000 doubled the amount of RAM. That's another example of stealth upgrading.

how many games looked better because of it?

yes we need lots more power, we need 1080p at 60FPS on all games and 1k npc on screen

But just think of the jump from PS2 to PS3. Dvd to Blu Ray, Online features, 3D, Motion controllers, Graphics etc. Is there really such a jump these days?

If SONY releases a new redesigned Playstation with a better Blu Ray, bigger and faster cell processor etc etc. It will most likely be backwards compatible, support Move, have the same PSN and online features etc, as the current PS3. Or if Xbox came out with a new redesigned Xbox, with blu ray, better ram, bigger hdd etc etc. It would also have the same features as the current xbox, Natal, XBL etc etc. Those consoles would most likely not be counted as a next gen console. They'd most likely just be sold as a new SKU, and the Arcade and PS3 80gb, or any other SKU, might be discontinued in its place.

But the sales would go on as usual on this site for example. There wouldn't be new tracking of how each of those two new models sold seperately. And the software would continue as usual. It wouldn't be Next Gen. It would be an upgraded Current Gen.

And i think these types of upgrades will continue on for alot longer than 2012-15, before we see all companies release a Next Gen console. Dont you think?

On the contrary, development cycles have accelerated and are continuing to do so exponentially with each passing gen (just look at all that's happened on the PC since the 360 came out, two full DX versions and brand new features of graphics/animation in realtime, multi core processors etc). I think this gen will end around 2012, perhaps even late 2011 and the next one will be slightly shorter.

but that kind of upgrade never works as I have said before, just look at the X32 and sega CD for the Mega drive/Genisis and how successful that was, look how successful the PSP Go was consumers don't like when companies release new hardware that is required for new games without it being a new generation, existing users don't like the fact that they have to buy a new version of the console they already have etc. If you are going to upgrade the base specs launching as a new console is a much better option even if you have new games that work on both platforms, I doubt many developers would bother if it requires extra effort to implement. More powerful hardware is available today that would show a big enough improvement for a next generation jump. 

the xenos specs are fillrate pixel:4000 Texture:8000 and meory bandwidth 22.4 GB/s vs

HD 5870 Fillrate pixel:27.2 thousand  Texture:68 thousand and memory bandwidth 153.6 GB/s plus much better Tessellation and other DX11 effects etc and real world performance is much higher than the specs suggest by late 2011 (the soonest that we will see a next gen home console IMO) it will be even higher by 2012 it could be a truly massive jump.

It's not that looked better, but they ran smoother and had faster loading times.