To add to the RAM/storage thing, the fact that it's always on the internet is a big deal. Media can be streamed from central servers on-demand, so cut-scenes and things like area-specific textures are less of a big deal.
My biggest worry is the focus on the television. Do you remember the head-mounted display John Carmack was showing around E3? The guy who made it gave an update [1] on the project a few days ago, saying
1) I am talking to Valve.
2) I am talking to id/Zenimax/Bethesda
3) I am talking to Epic
4) I am talking to Crytek
5) I am talking to Unity
6) I am talking to several other development companies
The extent of their relationships with Oculus varies, but
I can promise at least a few partnerships... I am working
with hardware engineers...
Imagine an HMD with a massive field of view and more
pixels than 1080p per eye, wireless PC link, built in
absolute head and hand/weapon/wand positioning, and native
integration with some (if not all) of the major game
engines, all for less than $1,000 USD. That can happen in
2013!
I think next-gen "serious" gaming will move in that direction (by all accounts the immersion is
stunning), and I think casual gaming will never move away from mixed-use devices like tablets.
1: http://www.mtbs3d.com/phpBB/viewtopic.php?f=138&t=14777&...