Talk is increasing about the next generation (which would be the 8th one).

Ubisoft CEO says they gotta get ready now.

http://www.gamesindustry.biz/articles/we-have-to-get-ready-for-the-next-generation-of-consoles-guillemot

Some of the article:

"What we've seen is that there are still lots of opportunities in this industry, and we have to get ready for the next generation of consoles," he explained. "I know each time I say that, everybody says that we don't know when they will come... but what we've seen is that when you don't actually have enough creators to make the games when the new consoles start, you can't take the time or have enough energy to use the capacity of those consoles.

For sure, it's a risk," he went on. "What I've seen all the way in this industry is that without risk you have less success. You have to take risk to have a chance to succeed.

I believe that this industry will continue to grow fast, and that it will be a very large industry. I think it interactive entertainment will grow in picking up the businesses that are around, like the movie industry did a long time ago."

Also, id thinks MS will be the first one to release a next gen system again.

http://www.gamesindustry.biz/articles/hollenshead-microsoft-in-the-best-position-to-release-next-gen-hardware

Some of the article:

"Somebody’s going to do it, and - to me - probably the player who's in the best position to do so is Microsoft, because I do think they’ve recouped a lot of the costs of their console," Hollenshead said in an interview with VG247.

"Maybe they’ll push the [Xbox 360] to year six - maybe seven - but I've got to believe that they're already planning the transition now, and they have their eye on the ball as to what it is, because I think they see that there are some weaknesses that they can exploit with what's going on at Sony," he added.

The biggest problem facing the games industry at the moment, said the CEO, is the global recession. As such, each platform holder is faced with "major disincentives" to start another console cycle.

At some point though, he predicted, "the PC is going to gain substantial competitive leverage by virtue of superior technology" which consoles will no longer be able to compete with."

I dunno, I hope this gen lasts at least 2 years longer than usual.

Interesting articles! (reading)

I think the last thing most publishers need is another gen with better graphics to spend more money on...

Ubisoft it making a profit though, so maybe they think it's an opportunity to crush publishers like EA if another gen starts soon.

As for the start of another gen, I agree with iD that Microsoft is most likely to go first... Nintendo can still squeeze a lot from the Wii as a winning console, Sony already has enough problems without spending billions on another gen.

On the flip side of better technology is that if you consider graphics at this level to be good enough, you can achieve better effect with less cost and effort. Theres no reason why they would have to spend the money, there are still games which sell quite well today which have relatively poor graphics by comparison.

That would be true if the games industry wasn't so hit-driven, and with publishers fiercely competing to have the best hit.

I mean, Ubisoft has already said they expect $60 million budgets to be the average in the next gen:

http://kotaku.com/5293126/ubisoft-ceo-expects-60-million-game-budgets-next-gen

I still don't know how they're going to double their revenue to maintain profit margins constant, though...

One thing I disagree with, is that PC's will have new technology the consoles won't be able to compete with. What is he talking about, better graphics, physics etc.? Does he not realize that these things are already "good enough" for the vast majority of consumers.

The average sales of these hit games have increased and the retail prices have increased and the sales curve has become front loaded so they get their ROI quite quickly. I really don't think I can speculate any further on this as its a complicated issue and im kinda tired.

Ubisoft I think tends to really deal in hit games, expensive ones at that. But currently the model seems to be working for them. They are obviously happy enough with it.

No wonder iD says that, they make money from licensing more and more evolved graphical engines, so they definitely want graphical improvements to continue.

Convincing consumers of the same thing might be a bit harder of course.

Exactly what I was thinking.