Nintendo WILL have yo continue innovating for their next console.  Yes it will have to be considerably more powerful and will have to fit in with their low price tag...this will be achievable in 5 years time....but what we have to consider is what will happen with the PS3 over this time?

The PS3 is overpriced and overpowered.  It will take another 2-3 years of development to show us exactly what it can achieve.  The difference with the Wii, is that it is resolution fixed at the moment and there will be no changing that until they release their next console.  Although it isn't as noticeable now...the number of people buying LCD and Plasma and large sizes are increasing all the time...they don't want 28-30 inch screens anyway...they are going for the 40 inch+, this is when 480p and 720p and 1080p are noticeable.

The PS3 has a long way to go in selling the console and developing games and lifespan.  The Wii is different IMHO, it will have a drastically shorter lifespan than the PS3 and I can see Sony only released extensions to the PS3 rather than releasing a PS4 anytime soon.

Not sure what will happen with the 360 TBH, although I reckon sales will eventually slow down and stop over the next 2 years.

As long as the PS3 price is reduced soon and some killer apps are released....I see no reason why the PS3 cannot remain in the limelight for 10 years.  The PS1 and PS2 have easily managed 7 years plus and they both were less powerful than the other systems out at the time.  The PS3 I feel is significantly more powerful than the 360 and this alone will give it the edge to see a longer life than both the 360 and Wii.

The Wii though will sell loads of units, but I can see nothing other than a serious slowdown in 2-3 years time. 

Lets face it nobody expected the revolution that was the wii and nobody knows whats coming next. Nintendo always seem to be the great innovators on systems, if the wii does manage to continue its current success it seems almost certain that all future gen consoles will be motion sensitive. Nintendo has rarely failed in innovation (GC was a failure because it DIDNT innovate enough) and that seems to be what has won them a large amount of console wars. Im really looking foward to see what feature, if any, the next nintendo console will sport.

@Davy, I think if we follow Moore's law if Sony decides to skip a generation the ps3 will be hugely underpowered in comparison to everything in that gen. Has any console ever been close to the power of the next generation?. PS2 is underpowered compared to the current generation and it keeps selling for two reasons, a game library thats massive and a low price. If the PS3 manages to ramp in 2008 it may be able to pull those off but I get the feeling that if they leave it any longer they simply wont be able to reduce manufacturing costs and get the support of enough developers.

I cant really see why Wii would have the massive slow down you predict, Im currently backing them as odds on to win this generation largely because the general population (which is what Wii targets) dont care about graphics in the slightest, they have no idea what a game is meant to look like. The Wii's only real weakness is that it lacks the hardware to produce the graphics that the X360 and the PS3 can manage (which to a gamer is quite a large weakness) yet if its target market cant spot this weakness then... who knows?

First off, the title is a bit... redundant. Nintendo products have always been cost-effective, from the company's perspective (they don't lose money to be offset by software).

Second, any company who wishes to have a prayer of a chance in the console industry needs to innovate. This is not something exclusive to Nintendo. Sony and Microsoft, and for that matter, anyone else who decides to take the plunge will have to innovate.

BTW, Welcome to the forum, Rath! (You're not Rath as in Rathbone, are you?)

One other problem, is the cost of developing titles for Next Gen games and the Next Gen after this Gen....get that!!! Games are costing a fortune to develop on the PS3 and 360 at the moment....and a step up in visuals again will cost them even more...it will get to the point where games need a Hollywood budget to develop. This is why I reckon this generation will last a bit longer. Nintendo WILL release a new console that will have similar graphical capabilities to the 360 and PS3...in 4 years time or so.....Microsoft are just mad and they will continue to release powerful consoles in a desperate measure to beat Sony and Nintendo. Sony do not need to do this...they have a hughly powerful machine out at the moment and developers will be taking a hit on their costs for the next few years and they won't wont to do the same in such a hurry....as I can see 3rd party developers going bust over the next few years. Anyway....this generation including the next Wii will be around for 10 years or so.

Well, looking at the growth of the industry, about five years ago videogames were roughly 1/2 the size of Hollywood; today, it's roughly double the size of Hollywood (in terms of overall revenue). At some time or another, the big guns like EA will probably continue to develop games with ever-escalating budgets but there will definitely be a niche market for indie developers, much like how movies are made today.

So yes, I do see not only this happening, I also see an impending seismic shift towards how games are developed, published, distributed and played.

I can also see unions, wage scales, cross-market tie-ins, mergers, and certainly videogame ubiquity. By the time my son is 18, everyone will have and play videogames in one manner or another.

Industries undergo paradigm shifts at some time or another. Videogames will be no different IMO. This should be great news for gamers!

Rath as in Rathanax (dont ask, please XD)

 I can actually see Microsoft making a new xbox console in that time, why? Because the Xbox is huge for microsofts marketing and in a company like microsoft everyone knowing your name is important. Im not sure what their net profit or loss is on the X360 but unless its a huge deficit I think that microsoft wont care.

PS3 however has so far been a financial disaster, its losses have cut BIG time into Sony's net profit. If it doesnt improve I can possibly see the gaming division being pruned - which I think would be a huge loss for console gaming as a whole. Personally I think that Nintendo is going to be the company to lead the next gen, followed by MS and hopefully followed soon after by Sony.

Well, this is only somewhat true ...

Total revenue from the videogame industry is greater than the box office but DVD sales, Pay per view and Television licencing make up for nearly 2/3 of the Movie industry's revinue; meaning the movie industry is several times as large. At the same time the movie industry does not include revenue generated from DVD players in their calculations whereas the videogame industry does include sales of (expensive) game consoles which means that the game industry is even smaller than advertized.

One thing people are missing is one of the results that will come from the Wii ...

The success of the Wii will be a demonstration that gameplay is far more important than graphics and i(f Nintendo decides to go with a console that is 10 times as powerful as the PS3 in the next generation) developers will not feel forced to produce expensive, graphically impressive, games. A smaller developer will have the option of sticking with graphical technologies similar to what the Wii can currently do at a somewhat higher detail, whereas large developers can push the boundries of photo-realistic (and non-photorealistic) graphics; there will be a greater emphasis on it being the developer's choice.

Davygee, I don't get your logic on the PS3 having a ten year life span. You have to look past the Sony PR. Its looking highly unlikely that the PS3 will even be profitable. Sony has built its business model based on a dominating market share. Given their current predicament, the PS3 finishing in first place is a near impossibility. Third party developers aren't going spend massive amounts of money to support the PS3 unless its sales start pick up. The Gamecube sold faster that the PS3 is selling. The PS3 will have a 5 year life span, give or take a year.

helmetless 3D thats next gen people!!!! Only from Atari