So you have one console where the games cost $60, come on a disc, and use up to 50GB of assets vs. another where they cost $70 and come on a 8GB card? It'll be N64 vs. PS2 all over again in that case. I don't see the console with the more expensive and limited games succeeding if the games are graphically the same, which they won't be due to reduced storage space. You'll only have so few different levels before the textures fill up the disc.
Nothing beats optical as a physical distribution medium on cost/GB. I'd be more in favor of DD like Steam where you could pick up 8 month old games for 7.50 like Just Cause 2. But instead, Sony/MS ask $30 for an old game that can be found on disc for $10-15. I'm not saying DD will replace physical, but if the older games are there at reasonable cost (equal to or less than the used copy of a game a year later), I predict me getting a lot of DD games. It's all about the cost.
There are reports that the 3DS will support of to 8gig carts for its games. Its games do not cost more than umd games on the psp.
I also don't get why you believe one will be limited by graphical quality. The only one with limitations would be the disc drive that has set specs. If a console adopted SDHC or the new SD classes they would be able to continuely use new capacity as it becomes avalible.
currently you have SdHC at 4 , 8 , 16,32 and 64 gig cards. In 2012 lets say the costs are halved and 8 gigs is $5 , 16 gigs is 10 , 32 gigs is 20 and 64 gigs is $40 . Sure the 64gig cards will be out of the questions. But 8 gigs which is more capacity than the 360 has acess to is not , 16 gigs is also not out of the question which ism ore than double what the 360 has. Flash foward into the generation a bit and even 64gig cards might not be out of the question. Mean while if using only the standard bluray spec the discs will never grow past 50 gigs. So by the end of the generation it could be the disc based console that is behind the solid state one.
Also comparing the n64 to the playstation is not relaly fair in this. The largest n64 cart I know of was 64MB while a cd held 750MB or basicly 11 times the capcity.
A 50 gig bluray is only 6.25 times more capacity than a 8 gig sd card and 3.12 times a 16gig cart.
Other things to consider is the move to 20nm nand that will drop the prices again and the fact that the sd prices i'm showing are based on several layers of profit that wont exist for a console.
And finaly there are many pluses to sd.
1) Smaller form factor . An sd port or two are many times smaller than an optical drive thus allowing a smaller console and better air flow with in the console
2) Durability . SD cards will take alot more abuse than any optical format i've ever seen
3) Speed . SD cards are fast and getting faster and it would be very easy to make a custom package using raid 0 to increase speed further. Current specifications call for up to 720MB/s read speeds although nothing is any where near that fast
4) Noise . If we accept 2 to 4 gigs of ram next generation you will need a very fast bluray drive and even then load times will increase. a 12x bluray drive will transfer at 54/MBs and will need 37 seconds to fill that 2gigs of ram or 74seconds for 4 gigs of ram. Compared to the 58 seconds the ps3 needs to fill its ram . a 12x bluray drive will be extremely loud and will be very close to the 10,000 rpm limit and of course will not be a constant speed through out the entire disc.
I believe they could go on sdxc
The maximum transfer rate of SDXCs which follow the SD 3.0 specification was announced as 832 Mbit/s (these are called UHS104 speeds[33]), with plans that the SD 4.0 specification shall increase this to 2.4 Gbit/s.
The SDcard association selected Microsoft's proprietary exFAT file system in the official SDXC specification;[34][35][36] however, as with SD and SDHC, it is still a plain block device and thus arbitrary partitioning and other file systems can be used, such as FAT32, NTFS, ext2, etc.