I'm confused, did people actually think Scorpio was a new generation? Microsoft announced the thing saying it wasn't that. They've been saying THE WHOLE TIME that games wouldn't be able to be Scorpio-exclusive. Complaining this isn't a new generation is like complaining my PC can run old games and new ones...it's a good thing.
I think people aren't understanding what MS is trying to do because of changing dynamics of the console market.
Game developers wanted PS360 generation to last longer. Once the userbase reached critical mass, that's when developers were making the most profits. If you have 50-80M users, you release a AAA game and now if only 10% of gamers purchase it, you sell 5-8M copies. With only a 10-20M console install base, to sell 5-8M copies, you'd need to reach 40-50% install base penetration. This is basically impossible. At the same time game development and marketing costs are going up.
XB1 still has less than 30M install base. Starting a new generation in 2017 would be financial suicide for game development and 3rd party support for both Sony and MS.
Gamers don't understand how expensive launching new consoles is since many focus exclusively on the hardware side and ignore the software side.
"The $1 billion Microsoft plans to invest in exclusive games will get Xbox One users 15 exclusive titles in the first year the console is available including a few completely new franchises."
http://www.dailytech.com/Microsoft+...e+Games/article31656.htm#sthash.twgCPcB4.dpuf
MS/Sony are trying to accomplish at least four unique goals. First, they went x86 to ensure backwards compatibility with future consoles. That means the console is now a "rental" experience. You purchase the console box for whatever "temporary" gaming experience you want. Once a new iteration comes out, you can sell it and take your entire gaming library and use it again on the new more powerful console.
Second, MS wants to ease very costly transitions between console cycles. The developers just make a game that runs across XB1/PS4/Slim and the updated Pro and Scorpio. Sure, it might cost more money, but the marginal cost of cross-console development pales in comparison to the financial risk and costs developing a new $50-100M game for an all-new console which may only have 5-10M install base in the first year. This explains the usual drought of games that next gen consoles face during the first 1-2 years of their life-cycles.
This means game developers won't be waiting for years until 30-40M user base accumulates on new consoles since they can just scale the game up and down [720-1080p 30-60 FPS medium setting on low-end consoles, 1080p-4K 30-60 FPS ultra settings on high-end consoles], while selling it to existing users and new console users. With higher install bar comprised of "previous gen" consoles, developers/publishers could take more risk in game development. This is why we should be more chance for new IPs towards the end of the current generation.
Third, going x86 ensures MS/Sony no longer have to spend billions of dollars making custom CPU/GPU parts. We all know how much $ MS lost on Xbox before and how disastrous the Cell was for Sony. Now, AMD or whoever partner MS/Sony choose pays for new hardware development and all the risks are transferred to AMD. It's a perfect arrangement since now Ms/Sony can instead divert the hardware funds towards software, marketing and online services. There will be some costs for customization but these are small compared to the cost of hiring a 3rd party to develop a custom CPU/GPU no one needs outside of consoles (the old console business model).
Fourth, there is an exodus of console gamers to PC due to weak hardware on consoles. By iterating more quickly, MS/Sony are trying to keep this group more happy.
Overall, this new direction suggests that at least MS is trying to move away entirely from console generations as they have been traditionally defined by boxed console hardware. Eventually XB1 won't be able to play next generation games. What should happen is XB2's (or whatever it's called) games would run on Scorpio but not XB1. Gamers may be able to reuse Xbox 1 and Scorpio controllers on Xbox 2. Then, Scorpio 2 would run Xbox 2 games and so on.
The major downside to this strategy is much, much longer console life-cycles. For example, we got XB1 in 2013 and we'll get Scorpio in 2017. That means XB2 wouldn't launch until 2019-2020. It will be 6-7 years before XB1 is retired, maybe longer. Then, 2019-2020 XB2 would last 6-7 years. The old 4-5 year console life-cycle seems to be dead. In fact, it wouldn't be surprising that early launch/less demanding XB2 games may even work on the 2013 XB1.
In conclusion, the console generations won't be as clearly defined. MS wants us to buy games for the Xbox Platform/eco-system not for Xbox1. They are just giving us the option on the level of gaming experience we are willing to pay for, much like we have Core i3-i7 and GTX1050-Titan XP on the PC. This is why they aren't allowing Scorpio exclusives for now.
Finally, for those who expected a native 4K console, you are on a technical forum and should have known better to not fall for marketing. Even a $1200 Titan XP can't run most modern AAA games maxed out at 4K 60 FPS, but some expected $400-500 box to do it?
The main point here is we don't really define PC generations, other than by new CPU/GPU architectures. We just accumulate software and the PC hardware we use is just temporary. Once new CPUs/GPUs come out, our Steam/GoG/Origin/UPlay games don't become paperweights. We are also not forced to upgrade every CPU/GPU generation as long as we are willing to play the games without maxing them out.
Why shouldn't consoles move into the same direction of iterative hardware upgrades? It's not as if once Scorpio/PS4 Pro come out that XB1/PS4 are instantly outdated. These 2013 consoles are targeted as a base console experience and the iterations are aiming for a more premium experience.
What concerns me is developers may not be able to fully utilize the capabilities of the iterative consoles until they stop using XB1/PS4 as the base. It would also mean that XB2/PS5 will be held back by Scorpio and PS4 Pro should this strategy continue. The old model of game development where we see massive jumps in graphics every new console generation would also go away. Instead, it will be replaced by more gradual but continuous improvements in graphics.
Of course for this to work, PS4 Pro and Scorpio actually have to sell well.