Before this gen, each generation has seen a new competitor in the console ring.

3rd-gen: Nintendo (I don't really count the Master System any more than I would count the Neo-Geo)

4th-gen: Nintendo-Sega

5th-gen: Nintendo-Sega-Sony

6th-gen: Nintendo-Sega-Sony-Microsoft

7th-gen: Nintendo-Sony-Microsoft

This is the very first generation where not only do we not get anyone new, but we also lost a competitor.  Since there's no one new, I think this feels more like a 'round 2' for these guys.  What do you guys think?

Also, will we continue the circle and lose another after this gen?

Eh, you SHOULD count the Master System, while it didn't exactly catch on in Japan or the States, it did do reasonably well outside there, thanks to Nintendo pretty much ignoring anything BUT those two markets. You should also count the NeoGeo, the Atari 7600, the Jaguar, the TG16 and whatnot, they DID compete, though they got eliminated early.

3rd gen - 3 competitors(Nintendo, Sega, Atari)
4th gen - 4 competitors(Nintendo, Sega, NEC, NeoGeo)
5th gen - 5 competitors(Sony, Nintendo, Sega, Atari, 3D0)
6th gen - 4 competitors(Sony, Microsoft, Nintendo, Sega)
7th gen - 3 competitors(Nintendo, Microsoft, Sony)

Heck, there were several other niche players such as the Amiga 32cd, the CDi and NEC's PC-FX.

I wouldn't be surprised if some other niche players show up this time around either. Heck, I'm still thinking Apple will eventually throw their hat into the ring(though it's looking like that won't happen until gen 8 hits)

 spot on.  i was wondering how this differed.  it means the vg industry is finally stabalizing.  all 3 are competing, all 3 companies will learn to make vast profits (eventually).  this is good for gaming.  the big thing it does is it defines niches.  it seems that xbox gets online genres, ps gets single player, and ninty gets casual.  having this split is extremely healthy because then they will make games that sell to their audience, make better games because they know what their audience wants, and third parties know where they should put exclusives.

in all honesty, i dont think this gen could have started out better other than no system being over $400 and the ps3 selling slightly more software and much more hardware (would fit their niche better).