
Could this be the only gen where no console has failed? Lets face it, Sony's going to stay in 3rd, unless the 360 stops selling. Even though its in third, its not a failure console. The ps3 passed lifetime sales of the Gamecube, and is approaching the lifetime sales of the original xbox. Sony could regain their reputation easily nextgen and snag first place.
1. Use a similar design as the ps3.
This would be the main thing Sony has to do. They have to use a more powerful cell architecture. This way, they get more power, while keeping it cheap. Currently, The ps3 has one main PPE @ 3.2ghz directing jobs to go to 7 available spe's running @ 3.2ghz, with an 8th one incase one of the 7 fails. In my opinion, Sony should use this same architecture more cores and a higher clock speed.
2. GPU
This time, RSX2 chip, but make sure that its made carefully for consoels and not just a last minute gimped version of a PC graphics card.
3. Memory
Of course upgraded. Lets still use a combination of XDR and GDDR memory, although its expensive, prices should come down later.
4. PUSH THE MOTION CONTROLLER!!!!
If they don't want to be caught behind the wii again, they have to push the motion controller, and get some of their amazing first party devs to do a wii sports type game(make sure to include the archery game), bundled with the playstation motion controller/the new Playstation eye @ $60. Please don't torture us with wii controller like prices though.
5.Disc Drive:
Sorry, Sony won't be following their tradition of a new type of disc media with each new console, still going to be blu ray, but at a higher read speed
Lets conclude the specs and prices:
--------------------------------------------------------------
CPU: Cell Broadband Engine v2
2 PPE's @ 5.0ghz -- 3 threads each
20 SPE's @ 5.0ghz 2 disabled for increased yield
Disc Drive: Blu-ray drive reads at 8x. By then, Games using more than 25gb could easily fit on one of hitachi's 4 layered discs(100gb total) which they showcased at CES 2007 and could be read by any blu ray player
Storage: 120gb/250gb later models advance to 160gb/250gb/320gb/eventually 500gb hopefully towards the end of the next gen, you'll get SSD's.
Memory: 512mb XDR/1024mb GDDR(5?/6?)
Prices: 120gb = $350(Only ps1/ps3 backcomp)
-----------250gb = $400~$450(backcomp ps1, ps2, ps3)
PS Eye HD records @ 1280x768 60fps
PS Eye HD bundled with PS Motion Controller and PS Active(wii sports like title) @ $60(they need to subsidize this)
release date: mid 2012

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You're saying Sony is losing then? Great article but I think you're going to have some pissed off fanboys over this. They won't admit their in third place. They definetly still have a chance though. Sony does I mean. But seriously... hell hath no fury like a scorned PS3 fanboy. Good luck though bud.