Judging by Sony's recovery rate, and the billions of dollars they lost, and the Vita, Xbox 720 - most powerful, PS4 - 2nd place, Wii U - 3rd place. But who cares about specs, right? It's all about the games.

There could very well be some FUD being purposefully leaked out, possibly by both sides. I know Microsoft were masters of FUD in the '80's and '90's. Also the thing that gets me is that the eurogamer rumor clearly states they don't know much about Durango and how it's "hoarding it's secrets". Durango is rumored to include edRAM or possible esRAM to assist in counteracting the slower RAM (if true). Soooo much we don't know yet...

100% correct, Neil Thompson said that budget won't go up much, not that the hardware won't be a huge jump, he actually said there would be a huge jump.

If you read my last two sentences I had an answer for that aswell. Even if the hardware is the best possible hardware,  then its still a question of talent and budget. The hardware isnt making the game. Humans are, and they have limits on what they can produce.  Look at how many studios have died off due to over spending and under performing.  A quick google tells me that the samaritan tech demo required 2.5 terraflops. Lets take the time to gather the information on the samaritan tech demo.ill find what i can. it would help if you could bring something to the table as well . So far all ive found is that it was running on 3 gtx 580 gpus. I would like to see the cost to develop it as well. I will come back to this as i find more info.

He also said that it wont be obvious. Seeing as he does art and animation, that tells me that graphics arent getting much better.

I feel like you two are ignoring my point that hardware is not the final deciding factor here.

get a job???

Some information I am gathering on the tech demo. It took 3 months of development. To clarify that, for a game that would take 2 years to develop, that is 1/8 the time on one cut scene .For a 3 year dev cycle that is still 1/12 of the total cycle on one cut scene. Tim Sweeny says in an interview about the tech demo that disk drives have no future in entertainment devices. that suggest it would at least be difficult if not out right problematic to do this grade of work with disk based media. To run at 1080p 30 fps it took 2.5 teraflops. Unreal engine 4 is not scheduled for commercial release util 2014. The tech demo was dependent on direct x 11. I cannot find a good source that says what hardware they used to run it. I am finding that it was either 3 gtx 580 or one gtx 680. Is there anything that you would like to add or correct this this?

So far it does not look like that grade of work would be viable for the majority of the industry.

It took 3 months of development. But with how many people working on it? I doubt the number of people who worked on this demo is comparable to the number of people working on an entire game.

I've seen the same kind of argument regarding S-E's Agnis Philosophy.  The truth is, only a fraction of the work force required for a full fledge game worked on those kind of demos. 

I think people have got the costs of developing games a little skewed.  More advanced games doesn't necessarily mean it costs more to produce.  Much of the increase in gaming development has more to do with the cost of everything going up, not so much the HW they are developing it on.  I mean, they're not paying per polygon or texture.  If an incredibly powerful system is easy to develop for, than you could pump out a game for about the same amount of cost (probably less) than a weak system that is difficullt to develop for.  I can't even imagine how cheap it is to develop on the Vita, if you have a PS3 version already in development, as one developer stated it took his team only an extra 2 weeks to port their PS3 game to the Vita.

Look at something like GT5.  That game was revealed to have a budget of $60M.  While that seems pretty big, just keep in mind that GT5 is a big franchise game (which have larger budgets, anyway) and that covers development for over 5 years, with over 140 staff members working at PD.  The vast majority of games only take 1-2 years to develop and have quite a fewer amount of staff working on them, so their budgets are going to be AT LEAST less than 1/3 of that.  Then you have to factor in the scale of the game.  A linear game that lasts for 6-8 hrs is going to cost much less than an open-world game that has 30+ hrs of content.

*If* true, that's a mistake by MS. I will stick with Sony, but I'd like a new controller this time out, Dual Shock is too dated.

Bring on PS4.

A 7850 or 7970M are quite power in the 1.8 TFLOP range, that would be about 7-8x the 360, with 4GB of GDDR5 RAM, that would be a nice jump in power if you ask me and not unreasonable in cost.