[CNET]

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Now, here’s the landscape as it currently stands: The Nintendo 3DS and PlayStation Vita have been fighting an uphill battle to reclaim a stake in the market from smartphones and tablets. The upcoming Wii U faces scrutiny and skepticism, both for its dual-screen gaming and for the cooling-off of the Wii brand in general. And, finally, the Xbox 360 and PlayStation 3 will be seven and six years old, respectively, come November.

Meanwhile, Apple continues accumulating profit while building a massive, vibrant catalog of popular, cheap games. And Apple, unlike Microsoft, Sony, or Nintendo, releases new hardware every single year. Processor speed, graphics, and screen resolutions keep getting better. The software improves. And, most importantly, the games keep getting more impressive.

We might be heading toward a post-hardware landscape for console games, where downloads are accumulated in cloud accounts like Steam, Android, or Apple’s App Store (or, the way PSN and Xbox Live already allow). Still, without new hardware or a new product, a new concept, interest is guaranteed to wane. No amount of new games can cover for this…because, except for very rare few exceptions, games just aren’t the killer apps they used to be.

Games are cross-platform. Most great games, apart from Sony/Microsoft/Nintendo exclusives, can be played on multiple consoles, and often on a PC. …

I could see other ways that E3 could make a bold move to stand out:

Launch micro consoles. A mini Xbox 360 at $150 could become a plug-in alternative to Apple TV and Roku boxes, …

Make a real gaming phone. Sony never did it with the Xperia Play, but maybe Microsoft could …

Make systems cheap, and sell content subscriptions. Maybe the “new product” is a new business model. Could games other than MMOs be subscribed to? Activision experimented with the idea via Call of Duty Elite. The amount of DLC floating around on consoles could warrant a subscription model if the content’s good enough.

Make something magical. Does that sound vague? Well, that’s because it is. ….

See the full story here: http://reviews.cnet.com/8301-21539_7-57443145-10391702/e3-needs-a-new-product/