The obvious profitability lessons learned, and therefore the most likely route for Ms and Sony, is the Xbox 720 and PS4 both having a variation of the same, now sufficiently capable 'semi-modified' APU, which, now that they have a near turn key single chip solution available, means Ms and Sony can piggyback on AMD's already existing research and development.
For GPU technology that is fine, for CPU tech I think Phil's Bait Shop on the outskirts of Redmond roflstomps AMD in terms of quality CPU R&D. IBM and MIPS have owned the console market for a long time for very good reasons.
Ths will not only slash Ms' and Sony's developments costs, it would also slash the developers and publishers costs as they could could port their games between the Xbox 720, PS4 and the PC at a fraction of the cost and manpower burden of current gen. More $$$ for all!!! A LOT more.
How is this, in any way comprehensible, a benefit for Sony? MS I guess you could argue using insanely crap hardware will at least assure them of DX's advantage over OGL, but for Sony the cost of porting to the other platforms is a non factor. No Sony games are going to come out for the 720, and no MS first parts games are going to come out for the PS4.
Under this scenario Ms and Sony would broadly split the gaming market with Nintendo coming in a distant third, say 40/40/20.
If Sony and MS use an AMD APU Nintendo will obliterate them in a violent fashion. It won't be remotely close. If Nintendo has a console that can handle all of the ports, has a larger installed base due to launching first, and has Nintendo first party exclusives then MS and Sony are dead in the console space. They stand no chance.
This time around it's going to be about hardware profit MUCH sooner than later
Hardware profits don't matter. If they aren't taking huge losses on hardware, licensing will make them semi loads of cash.
AMD's APU's will far outstrip the current console hardware.
No, it won't, not even in the realm of it. It may have a *slight* performance advantage, but it would be so small that the mass of console gamers would laugh, call it a piece of sh!t and not buy it. Recent AMD APUs still lose to a 8800GT, they aren't even a generation ahead of what Sony and MS have in the six seven year old consoles. Console gamers expect order of magnitude performance jumps between generations, they are going to laugh at ~15%.
If Sony and MS really wanted to go stupid cheap, they could just use high end ARM SoCs saving them a lot of money over the expensive, hot a huge APUs, eliminating the worries of AMD imploding to the point of failure and giving them more options at moving their code base around(Win8 is banking on ARM success already).