Crytek co-founder Cevat Yerli talked about the future of gaming graphics in his keynote at GDC Europe, you can read about it over here.
Talking trends, Yerli observed that GPUs and CPUs are "on a collision course", as CPUs get more parallel and GPUs -- already highly parallel -- are moving towards more general-purpose computing. He recommended OpenCL as a good base for addressing the issue.
In general, Crytek is trying to make all of its engines very scalable, due to the uncertainty about when the next-gen consoles might arrive. Yerli suggested that Crytek is estimating 2012 to 2013 for the next generation of home console hardware. But thanks to the success of the relatively horsepower-light Wii, "there's a big debate about whether there will be a next generation at all", he admitted.
The Crytek co-founder also discussed the dangers of the Uncanny Valley in work that companies -- even Crytek -- are doing. So he suggested most games use artistic styles, physics and AI to differentiate themselves, at least up to 2012 when the next generations may arrive.
Early visual style development is key, even now, he said. Procedural content development is also a heavy research area for Crytek, with Yerli saying that his dream is to create a game made by just a few people that looks like it was created by many more.
He then focused on the actual technical innovations that he feels will make a difference in graphics. For example, tech like point-based rendering is potentially faster than triangle-based rendering at certain higher qualities, and works well with levels of detail.
On the other hand point-based rendering might define a certain super-high polygon look for game, Yerli said. However: "There's a lot of games today in the Top 10 which don't need that", he conceded, and content creation tools are almost exclusively based around triangles right now.
He also noted ray-tracing as a possible rendering method to move towards, and particularly recommended rasterization and sparse voxel octrees for rendering. Such principles will form "the core" of future technology for Crytek's next engine, Yerli said, and the goal is to "render the entire world" with the voxel data structure.
Concluding, Yerli suggested that, after 2013, there are opportunities with new APIs and hardware platforms to "mix and match" between multiple rendering models, with "a Renaissance of graphics programming", and visual fidelity on a par with movies such as Shrek and Ice Age rendered in real time.