I look at the console world and feel like I&#x27;m taking crazy pills.<p>The massive reduction in cost of hardware has enabled every device to get smart. And, surprise surprise, the first things to get smart were the things with screens - phones and TVs.<p>Video game consoles (and all set-top boxes) hearken back to an era where the average house only had one TV, and it was dumb.<p>These days, there&#x27;s a dozen screens in the home, and all of them have computing power many times greater than even the original XBox - more than enough juice to power a huge catalogue of existing games.<p>So why do big game companies (Sony, Microsoft, Nintendo and now Valve) still feel they need to make hardware?<p>And I&#x27;m not suggesting that these companies give up their 1st party platform advantage - just that their platform doesn&#x27;t need to be hardware anymore. A cross-platform Nintendo App that runs the Nintendo VM and stores all of your games in the cloud makes a lot more sense than building a second rate piece of hardware and managing the supply chain to get it to the living room.<p>The only area where you can argue hardware is still necessary is the controller - afterall, our hands haven&#x27;t changed that much and immersive gaming experiences haven&#x27;t adapted well to touch screens. But surely it&#x27;d be easier to manage a supply chain for bluetooth controllers than it would a console.<p>If you add cloud graphics processing to the mix to overcome the horsepower issues of lesser hardware, something NVidia and Sony have both demonstrated at this point, then there&#x27;s absolutely no reason to continue to push hardware other than inertia.