I still mostly see sharp shadows in games which should actually be diffuse. See Cyberpunk 2077 trailer. I find that very unrealistic.
Not only raytracing but also voxel effects like voxel GI, AO etc. would be important for a generational leap. But such effects do need a lot of memory and by no means there should be saved too much by Sony and Microsoft in this area.
He said shdoaing and ao.