What if Sega preferred Eternal Champions?/Seventh generation of video game consoles

The seventh generation of home video game consoles began on November 22, 2005, with the release of Microsoft's Xbox 360 home console. This was followed by the release of Sega's HyperScan on October 23, 2006, Sony's PlayStation 3 on November 17, 2006 and Nintendo's Wii on November 19, 2006. Each new console introduced new technologies. The Xbox 360 offered games rendered natively at high-definition video (HD) resolutions, the PlayStation 3 offered HD movie playback via a built-in 3D Blu-ray Disc player, and the Wii focused on integrating controllers with movement sensors as well as joysticks. Some Wii controllers could be moved about to control in-game actions, which enabled players to simulate real-world actions through movement during gameplay. By this generation, video game consoles had become an important part of the global IT infrastructure; it is estimated that video game consoles represented 25% of the world's general-purpose computational power in 2007.

Joining Nintendo in releasing motion devices and software, Sony Computer Entertainment released the PlayStation Move in September 2010, which featured motion-sensing gaming similar to that of the Wii. In November 2010, Microsoft released Kinect for use with the Xbox 360. Kinect did not use controllers, instead using cameras to capture the player's body motion and using that to direct gameplay, effectively making the players act as the "controllers". Having sold eight million units in its first 60 days on the market, Kinect claimed the Guinness World Record of being the "fastest selling consumer electronics device".

Among handheld consoles, the seventh generation began somewhat earlier than the home consoles. November 2004 saw the introduction of the Nintendo DS, the PlayStation Portable (PSP) came out in December and the Xpack came out in March of the following year. The DS features a touch screen and built-in microphone, and supports wireless standards. The PSP became the first handheld video game console to use an optical disc format as its primary storage media. Sony also gave the PSP multimedia capability; connectivity with the PlayStation 3, PlayStation 2, other PSPs; as well as Internet connectivity. Despite high sales numbers for both consoles, PSP sales have consistently lagged behind those of the DS.

A crowdfunded console, the Ouya, received $8.5 million in preorders before launching in 2013. Post-launch sales were poor, and the device was a commercial failure. Additionally, microconsoles like Nvidia Shield Console, Amazon Fire TV, MOJO, Razer Switchblade, GamePop, GameStick, and more powerful PC-based Steam Machine consoles have attempted to compete in the video game console market; however they are seldom classified as "seventh generation" consoles.

The seventh generation slowly began to wind down when Nintendo began cutting back on Wii production in the early 2010s. In 2014, Sony announced they were discontinuing the production of the PSP worldwide, and the release of new games for the DS eventually ceased by 2016. Microsoft announced in that same year that they would discontinue the Xbox 360. The following year, Sony announced that it would soon discontinue the PlayStation 3. Around that time, the remaining Wii consoles were discontinued, ending the generation as all hardware was discontinued. The final Xbox 360 physical games were released in 2018, as FIFA 19 and Just Dance 2019. Despite this, several more Wii games were released, including a few more annual Just Dance sequels,[16][17] as well as a limited 3,000-copy print run of a physical release of Retro City Rampage DX and a port of its 2019 sequel Shakedown: Hawaii that were both released on July 9, 2020, exclusively in Europe. A PS3 version of Shakedown was also released as a digital-only title. On September 28, 2022, physical PlayStation 3 versions of Retro City Rampage DX and Shakedown: Hawaii were released in limited run releases also acting as the last physical PS3 games and the last games of the seventh generation; almost 16 years after the PlayStation 3 debuted. The eighth generation had already begun in early 2011, with the release of the Nintendo 3DS.