(Minus the next Wii)-Ran out of room for inputting Subject. (If a thread like this already existed, sorry--I didn't find anything)
If you think about it Development costs go up each generation, the costs of the systems themselves have went up this Gen compared to the last one, and portable video games like the PSP and DS are getting sequels to games that would never be made on those systems not so long ago (Dragon Quest IX, Metal Gear Solid-Peace Walker, Valkyria Chronicles II).
People don't have as much time nowadays to spend the time (also with how long games can be too) to be in their homes playing games. If you look at sales too, the Nintendo DS is the fastest selling this Generation, followed by the PSP (even with its sharp decline in America). The Current generation of systems can't really make games that much more fun to play with just increased system power (I play some PS2 games that are more fun to play than some PS3 games I own). This also explains why this generation already 5 years in, not even the sucessors have been anounced, let alone released (4-6 years is the norm) and not one of the Big 3 have.
But the only thing limiting this from happening, is the resolution on those small screens. They are slowly increasing, sure but it's going to take at least a 640X480 system to get the same area as on a standard-def TV screen. Supporting all the buttons on the Dualshock, well we're almost there. Just missing 2 shoulders and another analog stick (PSP). With these limitations no longer there, and add in TV out as standard, there would really be no need for Consoles (portables could reach the power of a PS3 within 10-20 years).
I not saying that this will happen, but there are things in motion to make the next gen. or the one after that have that possibility. Maybe I'm just getting old, I have been gaming since the NES/Master System days after all.













