First some performance facts for current consoles (feel free to correct me or complement):
Playstation 3: 2006
64-Bit-PowerPC 970 compatible
Cell : 3.2GHz max. 204.8 GFLOPs (or 180 GFLOPs for 7 cores) for single precission
14.63 GLFOPs (or 12.8 GFLOPs) for double precission
graphic: 24 Shader-Pipelines; 22.4 GByte/s DDR3; 275 million polygons/s
XBox 360: 2006
64-Bit-PowerPC 45 GFLOPs (?precission)
graphic: 48 Shader-Pipelines; 256 GByte/s DRAM; 22.4 GByte/s DDR3; 4 Gigapixel/s; 500 million polygons/s
So a PS3 does more calculations for better simulations but is slower in graphic display.
vice versa for XBox360
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Rumours
PS4:
Power-7 with 6-8 cores and 200 GFLOPs
(new Cell 8i with 102.4 GFLOPS double precission)
graphic: Power-VR
Xbox 760:
??
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Prediction analysis
The consoles are probably not coming out before 2012 because of development needed.
That's two Moore's law generation of doubled transistor density or 2 * 2^2 possible parallel processing power.
Well, for games at current level we may not need more than 2x calculation power for AI, but increases will rather depend on objects and physics. Doubling object density on the ground/area would require 4x calculating power.
Apply this to graphics and 3D TV that would require 8x graphic power, and this does not count realistic (rendering, 10x mapping) increases. PC graphic might outdo this by the time.
So to compete with PC's 8 times increased power are at least needed. But 10+x would secure a reasonable lifetime.
Rumoured PS4 seems to meet pure calculation power requirement in double precission but graphics?