A new generation appears to be upon us. Nintendo is out of the gate early with a much need upgrade to its console library. Not to be outdone Microsoft and Sony are hot on their heels. Microsoft is being more closed lip about almost everything they are doing, while Sony has recently started teasing that they are going to announce something new and interesting. But what if the next generation is not all about local based consoles? What if this is all about something else? Something far more ethereal?

The console market is changing. Ouya, the Android based system, is set to start shipping to those that backed it last year via Kickstarter and will be available for general purchase this summer (so goes the rumor). Once the initial roll out is done Ouya plans to release a new console every year. This has the benefit of making sure that the systems have the most recent hardware available and at $99 they are not too badly priced for replacement every year or so. Traditional consoles are more expensive than this as they require better tech at launch to keep them competitive until the next cycle and it takes a year or two for developers to finesse the programming language to it’s best. Since Ouya uses Android this problem does not exist as people are already developing for it. Sure it will not be as powerful as a traditional console, but it may not need to be. If anything the largest issue Ouya will have is getting larger publishers to create games for the system on Android instead of the traditional systems.

Next we have the Steam Box. Not just one system, but a number of possible systems that will range in ability and manufacturer that will all have two things in common. They will run Steam and they will be made for the living room. How would you like to never worry if your older games were backwards compatible? Or worry about them being lost or broken? And since you most likely already have a large number of titles on Steam (lord knows I do) you have already populated this console with games to play. The only real downside I see to this system is a possibly large monetary entry barrier, or it could be much lower. Or other companies (looking at you EA) could set up their own systems preventing titles from reaching the Steam box. This can be circumvented though if they allow you to install non-steam titles on the system.

And that brings us to possibly the largest elephant in the console room, the cloud. This behemoth is making its way into the gaming sphere step by step. Current consoles use the cloud to save your games so you can move from one system to the next without losing your progress. Then we have OnLive. They allow you to play games regardless of location and equipment. As long as you have a broadband network connection then you are able to play an OnLive game. The only PC you have is a netbook running Windows XP? No problem, just sign in and you are good to go. Gaikai does the same thing, and they were purchased by Sony in August. So does this mean that we may see cloud components in Sony’s new console? Will they use this tech to reduce the overall cost of their system but improve performance for systems that are connected to a broadband connection? This last bit is all speculation, but I think that if used properly it could change the console game space, hopefully in a good way.

And there we have it. This coming console generation seems to be split between Android, Steam, cloud, and traditional consoles. Nintendo has squarely placed their lot with a traditional console. But what will Sony and Microsoft ultimately do? Microsoft is expected to make Kinect an integrated portion of the next console. But Sony has been a mystery, for at least a few more days. All that can be said for sure is that the next year in consoles will be very interesting.

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