Hey Guys was thinking earlier after having played Diablo 3 and numerous other always online games i thought i'd give a look at why we actually do need consoles.
Let's say consoles go out altogether, and gaming only becomes available in cloud services like Steam, Origin, and the App Store. Well, what happens when the servers for those sites invariably get shut down? One day, services like Steam and Origin will no longer exist, or be extremely different than they are now. There's a good chance that one day the games you purchased will no longer be available. If they remove the DRM from those files before shutting down their servers, you are still stuck only being able to play that game on whatever device its downloaded onto. With consoles, you at least get a physical copy of the product you buy. Even if future consoles are no longer backwards compatible with older generation games, you can still always store your older consoles and bring them out when you want to play your older games.
Many gamers lament the fact that if you want to play all of the best games this generation, then you have to own all three consoles, as well as a state of the art PC, and perhaps portable systems. The amount of money you need to spend to be able to enjoy all these games is the biggest argument for why gaming consoles should make way for cloud gaming. However, it's the competition between the home console manufacterers that brought games to the level of quality they are at today. Going back to the days of Sega vs. Nintendo, to the current rivalry between Sony and Microsoft, the drive to outsell the competition is the reason that gaming is at its current graphical and artistic level of quality. Companies would have never been driven to increase the graphical power of their systems if they didn't have a competitor to one up. Without the need to have a killer app to sell your console on, we would have never gotten great modern franchises such as Halo, Gears of War, Uncharted and LittleBigPlanet. The downside may be flame wars between system fanboys, but that's more an argument against the mentality of gamers, and not the state of the industry.
WIthout consoles, gaming would no longer have a dedicated platform to call its own, and no longer have a dedicated audience to cater to. Many gamers may not be enthusiastic about having to shell out R4000 - R6000 (or more) for each next generation system, but if we want gaming to not only continue to support dedicated gamers, but continue to grow and evolve, we need consoles to be the culture for them to grow on.