Dev costs are almost certainly going to go up, because using more hardware power requires more man-hours. This has always been the case.

What Take-Two is saying is there won't be a burdensome switching cost from having to wrestle with wildly different technologies. For example having to re-write an engine to perform on PS3.

The chance of costs going down seems extremely low to me. People always say "oh, there will be new more efficient tools and processes", but there's always also more work. And people continually invent new techniques that then require more tools.

For example someone below says "But now games are being built with 4K assets in mind." But those 4K assets are being made with today's techniques, not the techniques from 3 years from now. In the next 3 years people will come up with new shading techniques, new fancy texture mapping stuff, etc, and using those new things will require more work.

At the end of the 360 era a lot of people said that models were already being made high-res and then baked down for normal maps and such, so the next gen wouldn't be any more expensive. But then the next gen introduced photogrammetry, PBR pipelines, etc. The mistake here is thinking that the games of tomorrow will be made with today's tech, when they're going to be created with tomorrow's tech. Most of the assets that are supposedly already being built with 4k in mind will have to be rebuilt, just like how the Kratos model was rebuilt for PS4 despite already being future-proof. (cough cough)

20 years ago if you wanted to make a 3d background weed it would take a half hour, now it takes a week when you include capturing the textures on-location, programming vegetation deformation, etc. (Sure you can amortize some of that, but still)

The only way I see dev costs dropping is if more games are content to deliver less content - for example by splitting multiplayer and singleplayer into separate releases. If they cost less it will be because they have less stuff.