PC Gaming isn't on the decline because of hardware. PC Games have always fluctuated in 3 to 4 year cycles where the new stuff won't work with older hardware. Perhaps some of you don't remember when you couldn't play 66mhz games with 33mhz processors, but I do.
There's a huge base of gamers that do know the ins-and-outs of their PCs, and do pay the money to keep up in terms of the hardware. That's because a lot of PC Gamers aren't 13, and actually have paying jobs and an income. You're also paying for more than just a gaming platform when you buy a PC. It doesn't matter if you can use a mouse and keyboard on an Xbox, nobody is going to game on it like they do a PC. Using it as so is just redundant, and leads to a lot of software compatibility issues.
Consoles are starting to lose a lot of the appeal they used to have. It's getting to the point where you can't even purchase complete games anymore. The online sweetspot has given console developers casus belli to justify early releases followed by the extensive patching that has plagued PC Gaming since its inception. The pre-requisite of unstable HD standards is also going to create huge dents in gamer's pocketbooks, since they'll be shelling out over a thousand dollars for a television that may not even be viable in the next two years in addition to the original 300-600 dollars they payed for the console. The only company that isn't adopting these trends seems to be Nintendo, which is why the Wii will be the first Nintendo console I've owned since the original NES.
The fact of the matter is that consoles are beginning to cost as much to make as mid-range PCs. The PS3 costs over a thousand dollars US to make, yet Sony is only selling it for 600 in the hopes that software sales will subsidize their cost of production. That's a lot of games for the average owner to buy, which is pushing it, since the lowest common denominator isn't like you and me, and has an extensive game library.
PC Gaming is on the decline because PC games suck. Don't believe me? Let's take a look at the big genres as they stand today compared to a couple years ago.
Modern Role Playing games barely qualify as roleplaying experiences to begin with. I don't see how you can say roleplaying gamers are sure to love Oblivion when that title has more in common with Grand Theft Auto than franchises like Fallout, KOTOR, and the early Ultima series that create tangible consequences in the game world based on the player's choices. Low-budget offerings are on the right track, but they get no real exposure. That a lot of them tend to be developed in Europe doesn't help either.
First Person Shooters are a dime a dozen. HL2 had great single player and multiplayer, but it serves more as a springboard for Steam than anything else. Valve's pay-to-play content doesn't hold a candle to what free mods used to offer. I love DoD: Source, but it doesn't hold a candle to the original Day of Defeat in terms of what it offers. 3rd parties can't just code-in the British, after all. HL2:ep1 is the same stuff you played in the original HL2, only with an incremental story progression and more shots of Alyx's ass. Everybody likes the first Sin episode, of course, but there's a very legitimate concern over whether or not 6 hours of gameplay is worth 20 dollars.
Doom3 was a great single player experience, but its multiplayer is very noob-hostile in terms of its accessibility (people who have played Quake 3 for the past 6 years are much more knowlegeable of Id's engine dynamics than people like me). Quake 4, not surprisingly was phenomenally average, and Call of Duty 2 lacked some of the lustre of its predecessor while offering little more in terms of its multiplayer. It also doesn't help, I suppose, that a lot of these titles are cross-platform releases, and as a result have been "dumbed down" by PC standards.
RTSes are just lame. I'm sorry, but whether it's Swords and Sworcery, or starships and phasers, it's all the same shit from a decade ago. RTSes are only truly great when the playable factions are well balanced between each other, and the gameplay actually involves a level of strategy. Supreme Commander seems poised to offer these, but the rest of the genre falls flat on its face. Even the sweetspot tactical RTSes are lacking in a lot of respects. Having to cater to their small online element, Rome: Total War had AI that was even dumber than in Medieval, and the player could simply hold back and decimate the AI with arrows before moving in for the kill. Granted, this is how the English defeated the French with the longbow, but the difference between the French and Rome's AI is that the French actually fought.
Other than that, I honestly can't comment much on RTSes. The Warhammer 40k game Dawn of War seemed pretty solid, but I could only repeat what I've heard through 2nd hand.
Honestly, what's going to save PC Gaming is digital distribution and its accessibility to independant developers. Steam is great and all but Valve makes a lot of shady business practices, which is why the advent of Galactic Civilizations 2 has proven the viability of the PC as a future gaming platform.
Galciv2 proved a lot of things:
1. Copy Protection is horseshit. Galciv2 had no cd copy protection, and yet it still rose to the top of Wal-Mart's retail charts. This disproves the notion that gaming sales have gone down because of piracy, as opposed to the fact that PC games just suck.
2. Digital Distribution is a great way to make more money for developers. With the distributor taken out of the picture, that means a bigger slice of the pie for developers themselves, which supplements the cost of developing the next project. Galciv2 itself wouldn't have been possible if it hadn't been for the online success of the Windows Galciv, which created a lot of revenue for Stardock. Not bad for a 10 man development team, eh?
3. People aren't interested in the name as much as they are by the gameplay. Publishers latch onto franchises like they were candy found on the street, preserved in its wrapper. Fallout, Ultima, X-Com, Command & Conquer, countless franchises have fallen by the wayside because their sequels failed to offer experiences that satisfied the original fandom. Galciv 2 proved this by offering gameplay that Masters of Orion fans loved, but wasn't offered at all in MOO3. It isn't about the name of the game that draws people, or even the narrative. It's the game.
The future of PC gaming depends in a large part on how many companies are willing to follow Stardock's example. The end result would be a lot of low-budget titles that are accessible and fun to play while making the process viable to independant developers. Sure you'd still have your big-budget successes like your FEARs, and Half-Life 2s, but niche gaming is what will support the PC as a gaming platform, and really that's what PC Gaming has always been to the mainstream: a niche.
