I've tried out this one streaming PC service called LiquidSky and it does cloud(ish) based processing for the graphics and locally the computer handles the input, so it's not that much of a farfetched concept. Latency wasn't that bad, it did have a slight delay for FPS titles but 3rd person action games like Assassin's Creed had minimal impact on the controls. Overall I'd say it's a decent concept, but the image quality would have to be either extremely compressed (if using ultra high settings), or the "screen size" would have to be drastically dropped to keep bandwidth usage as low as possible, as in instead of 1080p60, you'd get 900p30 or 720p60. That's also speculation on my part, but it's based on streaming for twitch and mixer since I've used both. I've found that in order to stream 720p60 or 1080p30, I need to use a lot of traffic. 900p would be almost as effective as 1080p, but again, it's about keeping bandwidth usage as low as possible. I've also used PSNow, which wasn't a terrible experience, but the lag was pretty bad for FPS games, sometimes as far as 3-4 frames, which at 30fps is a lot. Also played Assassin's Creed on that (it's my favorite franchise, if you couldn't tell), and the early titles were rough. 2 and Brotherhood were just about unplayable with how snappy the controls needed to be. Revelations, 3, and Rogue weren't as bad since there was a bit of a cushion with the character doing a transition animation to get up to speed, but it still kinda felt sluggish to me. Borderlands multiplayer was just about unplayable tho. There's already a lag since your game has to send the controls to the host player's game and then you receive the corresponding result. Even when not using PSNow, it's rough. Add in that 3-4 frame delay and you try to hit an enemy but it's so delayed that they've already moved and you miss, pretty much every single time. Lastly, the image quality was horrendous. While I don't normally complain about 720p, this is like if someone dropped the bitrate to 480p and 400kbs and then upscaled it. The sharpness was all washed out, the pixalation made the normally beautiful scenery a modern art interpretation of what a blind person thinks a field looks like, and the random lag spikes would make your side freeze up while the game is actively running and you have no control over what happens next. I think if the new console can get around those issues, there might be a chance for it to catch on. I wouldn't bet on them being the only iteration in the "next gen" (if there really is a full gen to go to now), and I don't see dedicated hardware leaving for at least a whole generation, if not 2 or 3 more.