[Unoeufisenough]

You don't integrate the game hardware into the device. It's relatively easy for the cableco to give you fast, low ping bandwidth to a local cable switch within their network. That's where you put the game hardware. You create a new gaming platform and virtualize the console to a cluster hosted by the cableco. This game-rendering cluster is scalable, upgradeable and on demand. You don't need to distribute a lot of expensive, loss-leadin, power-hungry silicon to every house - that ends up sitting idle 90% of the day.