I don't see why Sega would even consider making a new console, reading that letter it is a letter wrote after someone has just played their old sega for the first time in 30 years....
Physical media is coming to an end, there are positives to physical and I am a big fan of owning and collecting it but I do not see how we can continue to make physical media in a world with limited resources and the issues creating physical items brings about. This will ultimately bring about the end of physical consoles in the way that they are today and Microsoft can see this and have been getting ahead of the curve with their streaming service and subscription offerings. Sony have also cottoned I think now and that is what the PS Portal is about, a dedicated streaming device, I suspect the PS Portal 2 will be standalone and just stream titles from PS Plus.
I even think Nintendo will get caught out if they don't consider things going forwards, people have a lot less money today to keep committing to paying full price for Nintendo First Party titles (even when they have been out a number of years).
There is also the R&D costs to create a new console today, I don't think Sega have anywhere near the funds to achieve creating something new and different.
Correct me if I have misread this Lee but some things we do, fashion for example but not all, do you really think USB's or physical hard drive's will keep going as more and more people move to cloud storage? When was the last time you bought Microsoft word on a disc?
Vinyl has come back but that's because it has made listening to music more of an activity again, you have to take your time and you savour it more but you would not see cd's or tapes make the same sort of return. While video game's, the activity is playing them, not many people (especially in the modern world) appreciate the manuals, appreciate the box art and such, it's niche to collector's and that's why collector's editions of games still do well.
I think physical media has largely been kept alive by the ability to buy and sell second hand for a while.