In the long run I think consoles might get replaced to "consolerized" PCs (they are already technically, but I guess we might see more advanced software environments like steam boxes).

Neither Sony nor Microsoft had a consumer orientation and they will likely loose against the competition.

Physical media was a method to have a "plug & play" game, although that changed in recent times. With that I don't think classic consoles can compete, especially with their new price points.