The dawning horror for the console vendors is that the change is already happening around them and on every iPhone, iPad, Samsung, Android, etc device. These already have digital-only distribution. These already have very high-quality GPU's that push almost as many triangles as an xBox 360 or PS3, and are on a faster product-iteration-cycle. Some of these - iPad3 and Samsung Galaxy Tab's - already have higher-resolution screens than your 60" HDTV and many people are using them more hours per day and spending more dollars per device than they ever did on consoles. Yikes, if I were still in the console biz, I would push like hell to move a little faster than updating hardware every 7-8 years and doing poorly with software.
The dawning horror for the console vendors is that the change is already happening around them and on every iPhone, iPad, Samsung, Android, etc device. These already have digital-only distribution. These already have very high-quality GPU's that push almost as many triangles as an xBox 360 or PS3, and are on a faster product-iteration-cycle. Some of these - iPad3 and Samsung Galaxy Tab's - already have higher-resolution screens than your 60" HDTV and many people are using them more hours per day
You could argue a very similar point by replacing mobile devices with PC in your argument. But I console vendors don't look in horror in the PC market.
You are also missing a fairly big aspect of a game console, the games themselves.
many people are using them more hours per day and spending more dollars per device than they ever did on consoles
Do you have a reference for this? Sounds interesting, but I haven't seen the comparison before.
