QuDDus:
Incase you didn\'t notice, I am well aware on what XNA is about and what its benefits are. It is important though to realise that a lot of it is also hyped PR talk and that even XNA has its limits. Microsoft wants to sell XNA - they want people to think it will magically lower costs (which it will to some extent), but certainly not to that degree that it would make an early generation transition more attractive than making big cash on the ending current generation.
Let me explain why the last phase of a generation is often the most profitable stage for developers:
The last phase of a generation is usually in its 5 to 6 year. During this time, developers can look back at around 4 or more years of development, extensive researching and usually up to 3 or 4 games depending on their size. Now after every title that they develop, obviously, experience is gathered, libraries are developed and skills increase just as do art-assets increase. After 3 to 4 years of development, this will be one big bulk of information gathered worth a lot of money. Later games always benefit from previous ones by re-using art-assets and existant libraries to shorten dev-cycles. Good examples are Final Fantasy X-2 or the Getaway 2 which both re-use most art-assets from their previous games. As experience grows in development, development time decreases. At the end of a generation, the art-assets and libraries available reach a considerable amount which will make software cheaper to make and therefore make it even more profitable. Makes sense, doesn\'t it?
So now that we addressed why development is cheaper at the end of a generation, lets look at Microsoft\'s dilema:
Microsoft has turned in big losses with Xbox development, so obviously, they are very keen on ending it as soon as possible while gaining the head-start advantage. This way they hope to get two advantages: Being the first out and having the \'wow\' factor and second, halt Xbox production in favour of new "profitable" Xbox2 systems.
Now lets look at what their problem is: With every new generation that starts, AND regardless of the API used - any new generation is linked with massive intial costs. Why?
1.) New and more powerful hardware. Because art-assets are hardware driven, old art-assets can\'t be used and need to be re-created targeting the new and more powerful hardware.
2.) Old libraries can\'t be used, since they too are optimised for a specific hardware. In other words, no libraries can be re-used or only very basic ones, if any.
3.) New hardware require new ways of thinking and other approaches. This kind of R&D is necessary and costs money and time.
Given these reasons, it is quite obvious that developers dislike console transistions. They are expensive and require time and money. Even with the beauty of XNA, most intial costs aren\'t reduced and therefore, development costs are significantly higher for new consoles than it is for old consoles where 99% of everything previously created can be re-used.
Back to Microsoft\'s situation at the end of next year, developers will be facing a choice: To develop for Xbox2 with high initial costs or profiting on the grounds of cheap software with current generation. Since Xbox2 will not be backwars-compatible, it is more than likely that Xbox production is going to halt fairly soon after Xbox2 launches. In other words, since Xbox1 won\'t be supported anymore, it will be one or the other for most developers. On the contrary, if backwards-compatibility would be there - at least cross porting would be an option. Not having it, nullfies this possibility completely.
What does Xbox2 need to be successful?
Software. And what does it need to get software? Developer support. Obviously, it will have the support of its own 1st and 2nd party developers. Will they be enough to kick of Xbox\'s2 launch though? Even if yes, 3rd parties will still be given the choice if to support the new 1+ million base of Xbox2 or the 100+ million PS2 base (which would also be considerably cheaper). And given that Xbox wasn\'t even close to a leading console, one has to wonder, why would any developer even consider deving for xbox2 in favour of \'old generation platforms\' if the future is still uncertain by any means? On the other hand, once PS3 launces, PS2 will halt, but the software will still be usable with the PS3. This gives developers the freedom to still develop for old generation.
So to cut things short: XNA is great! Will it cut costs? Yeah, sure. Of art-assets? No. Will it make next generation development cheaper than current generation? Hell no. Not by any chance. The biggest strength of XNA is basically for portings from XNA to XNA. This could help the Xbox2 -> Xbox3 transition, but anything beyond that is just wishfull thinking on the believer or MS PR talk without much substance.