I'm not speaking about flop or not, I'm speaking about power. PS3 and 360 were far behind PCs. Not saying PCs aren't more powerful than ONE and 4, but we needed new systems now. Sales of the current gen systems have been on a decline for a while.

I don't even know where I'd put one.  Of course I'd put the new console on my best TV but that TV already has a PS3, PC, 360, and Wii U connected to it.  There just isn't room for anything else and I ain't disconnecting a console that has games I love to play (which is all of them) and replacing it with a console with no games.  I don't think there's room for Kinect in my game room, either.

I have a 1080p TV in the living room and it looks great.  I have a PS3 and 360 (with Kinect 1.0)  in there, too but that's not my favorite gaming environment.  There's still plenty of 7th gen games for me to play.  GTAV, MGSV, Rayman Legends, Splinter Cell Blacklist, etc.  I think I can hold out.

I don't know about that. That footage could have came from current generation consoles, not last generation consoles like the PS360.

Consumers will determine whether or not a new console was needed. The real test will begin after the holidays.  

As a casual gamer I remain uninterested with the new HD twins. The X1 and the PS4 maybe getting good games but why buy them when I can get it on the PS360. 

If I were you I would just go about upgrading your PC instead buying next gen consoles altogether unless they have some exclusives you want. 

Well, he is right, of course, but at some point it becomes cheaper to just let more powerful hardware do the work than to optimize the software. As a simple, entirely contrived example: If you have a program that needs 100Mb of RAM, but the PC you are running it on only has 50Mb of RAM, the question is:

Is it cheaper to redesign the program to work with 50Mb of RAM, or is it cheaper to just add 50Mb more RAM to your PC?

Another reason why better hardware do not necessarily translate into better software - the developers may not make the same investment in optimization on better hardware than they would've done previously.

Kojima confirmed at E3 that it was running on then-current-gen tech. The game comes out in just a few months, and then we'll all see just what that wizard was able to pull off. I myself can't wait to see, as I can hardly believe my eyes when I look at what he's doing with the PS3.

I ain't going to buy them either. The only way I'll get them within the next two years is if I get them for free (christmas or something). But no matter how the consoles sell or not I think it was needed. The gap from PCs to consoles are growing, and Sony and MS need the third partys. I don't think they had a choice. Even though sales slow down next year, which I think they will (not wii u levels, but still unerperforming level) they will eventually pick up again. There is a market for homeconsoles. 

Nah. You can improve the compression if you're willing to spend compute cycles, 8:1 and 16:1 can be achieved, not only that but more data could be compressed too.
AFAIK only Textures are compressed on the PS3, you could also compress things like Normal Maps, light maps, shadow maps, HDR Textures etc'.
That would conserve allot of memory, then you can drive up the quality of each.

Plus, they could "bake" more things into a scene, that don't require extra passes.

Also, there is more to rendering than Rasterization, Ray Tracing and other methods are pretty demanding with the pinicle probably being Photon Mapping.
nVidia however did attempt to not "follow the crowd" during the "3D Revolution" where they attempted to use Quadratic texture mapping rather than the standard Polygon with the NV1 core.

As for culling... It can always be improved.
The Z-buffer isn't very smart and there is always at-least a little bit of overdraw, sometimes by a fairly large amount as the engine attempts to predict where the user is going to be looking next.

Besides, developers have for a long time now been playing a game of "Sacrifices" for example Bungie removed the Tessellated Water and Triple Buffering from Halo 3 to free up resources, throw in improved compression and impostering and that allows Reach to offer better lighting, textures and polygon counts and a much much much longer draw distance. (Mostly thanks to impostering where it replaces a 3D model with a 2D sprite.)
Halo 4 took it a step farther and went with simple geometry for the games architecture and baked shadows in the game world to bolster character models and lighting substantually.

Essentially, each iteration looks much better than the prior, of course you would get some low level optimisations thrown in too.

There is still more to be squeezed out of the hardware though, well. In my opinion anyway, but I wouldn't expect anything massively dramatic.

You only have to optimise the game engine to do "more" only once, then you can use it for all your future games, depending on the game engine, that could be dozens of titles.

As for the PC, you have the option of doing neither, just let it fall back to virtual memory. :P

I don't want another killzone 2 situation again.

I will not be dissappointed if they came and spit out the truth that it was done on next gen consoles or hell even a PC. 

I guess we'll see the truth pretty soon.