The big three will come back for another round. Nintendo for obvious reasons, Sony because they remember when they were king, and MS because they're finally figuring out how to make money in this market.

Apple will enter the market, but not as a direct competitor. The Apple TV 2 (expect a cooler name for the actual product) will be an internet-capable device with a focus on media functionality, but will accommodate downloadable games with a wiimote-like interface (IR for sure, accelerometer maybe). It will have no optical drive, and therefore no retail games.

Nintendo is a gaming company, and they'll keep making games to the bitter end. Looking at the money they're making, they have no bitter end in sight.

Sony and Microsoft are not gaming companies, and their gaming divisions are responsible to people higher up in the company. If their consoles were to lose gigantic amounts of money, then it's possible that their main boards of old guys in money suits would decide to pull the plug on their gaming division.

This looks slightly more likely to happen to Sony than Microsoft, because the 360 is actually turning a profit. The Playstation brand is technically making money, but that's only because of the PS2 right now.

Of course even in the case of huge losses, both companies would be much more likely to scrap their current console, and try again with a different strategy. The whole "huge losses, and guys in charge of all divisions deciding to leave the console market" is merely the most likely scenario in which any of the current players drop out, and doesn't look likely at the moment.

The more interesting question is will they turn profits and will another company enter the console business?

The market wasn´t big enough for 4 parties in 2000 but it is growing fast. It should be possible for 4 companies to stay in this market. At least that would heat up the competition.

It is just not that interesting to analyse a market in which all consoles sell well...

2010 - x720 - Crysis 2 in 1080p 60 FPS.
2012-2014 - PS4d - 4 dimension - virtual reality games.
2010-2011 - Wii 2 - Crysis 2 in 1080p 60 FPS with Wii mote.

The question that im curious about is how the success of each console this gen will affect next gen.

Will everybody jump on the 'motion sensitive' bandwagon a la the wii?

Will everybody include a Blu Ray drive on their console, a la the PS3?

Or will everybody rush out their console early to get that all important 10 million sales figure in North America (a sure sign of domination) ignoring the fact that said console is faulty, defective and almost certianly guarenteed to blow up in the bedrooms of teenagers everywhere?

Side    Up   Side + Forward and Back = 3 dimensions in case you were wondering.

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Ok, in all fairness the motion controlls next gen will make these Wiimotes look like a joystick with 2 buttons.

You will have 100% accurate 3d positioning, cameras (2 most likely for 3d) instead of sensor bars. Also you will have better processors to better interpret your movements. Face and head tracking will also be included as well as better accelerometers inside the controllers to better judge speed and movement. I predect that the controllers themselves will be more symetrical in size and function, perhaps even identical as you would not have to include an Infrared camera in one of the controllers. Probably a cross between the nunchuk and the right hand side of an Xbox360 or PS3 controller.

The consoles will include the standard stuff, but the motion controllers will be expensive so I would no expect much more than an evolution in terms of power... maybe 2-3 times with smaller more efficient chips.

Look around you, look around you.....look around you.

By the end of this generation all of the consoles will have succeeded in making money I think, which is what they set out to do.

I would not at all be suprised If all of the consoles were very, very similar. You will probably see blue ray drives as standard, better online(XBOX ish standard), HDD and finally some sort of Wii mote that will slide into a controller with analogue sticks and shoulder buttons.

The graphics standard will increase but I do not really think it will come on the leaps and bounds that it has so far, this could create massive problems and spiral the costs of making games upwards. or am i just being crazy? GRAPHICS WHORES WIL BE THE DEATH OF US!

Yeah, they all will...

Yes all 3 . Nintendo and Sony is 100% . MS only if it actually makes a profit untill the end of the gen , but even if not I still see them entering :)

1. Yes.

2. Yea, probably Apple or EA. Apple will try and compete with the Wii, sense that's where all the money is, and cost a lot less to enter.