I've noticed that the regular mentality lately is that PC gaming doesn't stand a chance against the Xbox 360 or the PS3, and I strongly disagree. The PC has had some competition when both consoles were first released, but at this point, the specs of both machines don't compare to modern gaming PCs. I think that, if anything, console gaming is limiting the potential of PC gaming. As developers produce games primarily for consoles, they are creating them for less customizable systems, making them easier to make, but also limiting the technical potential of the game. The reason is that console games are generally more popular and advertised greatly on television and the internet.
The reality is that consoles are simply a computer, a computer with a specialized OS and proprietary hardware. This makes development easier, but also means that for simplicity, the hardware will not improve over time. When developers create a console game first, and then port it to PC(this happens more often on the 360), you get a game hardly better from a technical standpoint, but the public won't say anything, because the expectations are already there for the console version. Therefore, the PC is classified instantly as a gaming machine no better than the console versions without good local multiplayer.
There's a few ways we could restore the Personal Computer back to it's gaming glory. After all, if the PC is a more costly system, then why should it be in any way worse than a console? First of all, developers should start with the PC as a base system for development, then downgrade when porting to other systems, the PC usually being the far more powerful machine in general. The perfect example of a game like this is Crysis, and although it wasn't ported to other systems-CryEngine 2 not being portable-this showed what a dedicated PC game engine could do.
I am primarily a PC gamer, but the one thing that ticks me off more than anything is the lack of any split-screen multiplayer on pretty much any PC game. I don't know about you, but I wouldn't mind resorting to controlling Call Of Duty 4 using a gamepad if I could play with three other friends. Since a basic corded dual-analog gamepad on a PC is cheaper than what you can find for either major console, I wouldn't mind picking up a couple of Logitech Dual Actions so I could play COD with my friends. The PC is a great system, it's just not "cool" to play with friends at this point. We have a few great cooperative games(Lego Star Wars, anyone?), but these are usually limited to only two people, and we have very few options for playing competitively.
There are two important things the PC needs. The first is more cutting-edge games like Crysis, and the second is some old-school split-screen multiplayer.