Amid strong challenges from mobile gaming on phones and tablets, and with the spectre of Nintendo's Wii U launch late last year, Sony and Microsoft are preparing to announce their next generation console systems, with Sony expected to make an announcement on February 20.
It is believed that Sony's next PlayStation is internally code-named "Orbis", while Microsoft's next Xbox is called "Durango" behind closed doors.
Online reports suggest that Orbis will mark a departure from Sony's own Cell architecture to use a processor based around AMD's Jaguar technology; more specifically it is rumoured to feature an eight-core 1.66GHz AMD processor with 4GB of RAM.
Meanwhile, Microsoft's Durango project is rumoured to contain similar internals; an AMD 1.66GHz eight-core processor with 8GB of RAM. Both systems will feature onboard storage and, keeping with the strategy of being more than games console systems, will feature other entertainment options.
It is suggested that the next Xbox will feature a Blu-ray drive, in contrast to the Xbox 360's failed HD-DVD drive add-on.
What that does mean, not surprisingly, is that the next generation of consoles will be more powerful than their predecessors; website Eurogamer had Digital Foundry run through the purported specifications of both systems, with the suggestion that Sony's use of faster memory
- even though there's less of it - may give it a slight advantage, offset against how difficult it is to program for the new machines.
Microsoft's Durango is said to more heavily focus on the company's Kinect sensor, with a sensor built into every console; according to website Kotaku, it'll be capable of detecting how many people are watching a piece of content, and reacting if licence commitments aren't met.
Sony, meanwhile, has kept Orbis largely secret in terms of capabilities, although a leak last week suggested that the next generation PlayStation controller may feature a built-in microphone and touchscreen display.
Digital delivery and online media are key to both Sony and Microsoft's plans, with consistent reports that suggest they may require online access and block second-hand game sales by tying an individual games disc to a single console.
Orbis will reportedly allow users to play games streamed over the internet as well as via digital download and physical discs.
According to Australian developer Nic Watt of Nnooo, this represents an evolution of what's already happening with digital games delivery on mobile platforms.
"We're moving towards the digital future; you can see that with the iPad or iPhone, where retailers don't get a cut of any of that ... but I don't see too many people complaining about that on iPhones or iPads," Watt said.
He hopes, however, that any digital locking system would allow some flexibility.
"I'd like to think that'd it be more like a licence system as it is with Steam; you can log into any PC in the world with your account and access your games," he said.
Marketing director of EB Games, Shane Stockwell, is not so sold on the rumours surrounding a second-hand lockout.
"If I was concerned by everything I read on the internet, I'd probably have lost my hair a long time ago," he told Fairfax Media.
"I've learnt to take it with a grain of salt. That's all rumour; there's nothing to say otherwise; I think it would be a strange move from two major corporations to cut off a business avenue in pre-owned games."
It's not yet clear if the new systems will support backwards compatibility, although Stockwell doesn't see that as much of a real benefit to gamers in any case.
"From a business perspective, it's a great marketing asset, that you can play existing games you have. But what happens is that consumers take their old games, bring them into our stores to trade them in so they can afford to buy the new thing," he said.
Stockwell remains upbeat about the sales potential for new consols, despite figures from market advisory service NPD Group that show a decline of 10.6 per cent in high-definition console sales in 2012.
Stockwell's perspective is that EB Games has seen sales spikes with "every other console life cycle, so I don't see any reason why it won't happen this time around".
The Australian games development scene has shrunk markedly over this current console cycle, and Nnooo's Watt doesn't see a great deal of optimism for local independent developers when it comes to new hardware and employment opportunities.
"Independent games are obviously flavour of the month, and some developers are doing well with their titles," he said.
"More often than not with these hardware manufacturers, it's more playing lip service and getting the cool cachet that comes from that."
- FFX Aus