The PlayStation 3 and Xbox 360 have caused a shift in the console cycle according to EA’s chief financial officer Eric Brown.

During the Goldman Sachs Technology and Internet conference Brown doubted the need for new hardware anytime soon as they wouldn’t be able to bring anything new to the market; or at least nothing that would convince owners of the two most powerful HD consoles to upgrade.

Arguing that previous console cycles were driven by a combination of CPUs & GPUs which aimed at better resolution for games, Brown stated:

Today we have two of the three consoles that operate in full high-definition and are running games at 60 frames-per-second. If you step back and say if it’s a multi-billion capital dollar investment for the next generation, the question I would ask is if you were to produce that then what would you display it on? There’s really nothing in terms of broadly available consumer viewing technology other than 1080p flat panel televisions and so you could upgrade in theory but you wouldn’t get the obvious graphical benefit that we saw really drove the sharp transitions in the prior cycle.

He doesn’t say that the current cycle has been broken by Microsoft and Sony but that it has effectively been lengthened. With the majority of games now featuring extensive online experiences he argues that consoles are being used a lot more and therefore keeping interest high. This is backed up by the fact that at this point during the last console cycle the average selling price had dropped considerably - ”30% or so”. Comparing this to the current generation Brown said that the average selling prices still remain strong and have seen a drop of only “9-13%”.

With Natal and Sony’s Arc/Gem/Wand/Motion Controller on the horizon as well as Sony’s push of 3D gaming, there does appear to be enough to keep the current consoles alive for some time to come.

In my opinion, the uptake of 3D gaming will provide a good indication of whether or not consumers are looking ahead to future products. If enough people are happy to spend a small fortune (currently) on HD 3D televisions, then surely there will be at least a portion of gamers who would be willing to take the leap to the 8th generation. But, as Brown points out, the development costs for making that leap will run into the billions. At this point in time, is that a cost that any company can afford?

Thanks, Gi.biz