Well, to be honest, it will be very intresting to see the direction in which Forza series will go.
There is no other way to describe the sales of FM3 than modest. AAA title, that is pinnacle of genre on one platform, with crazy marketing and millions payed for licenses, development and such, and with more than 35 million consoles on market at release time should have sold better than actual numbers of FM3.
Also, when you look at online at this point, there is less than 2000 people at weekends-peak racing in Public Lobbies. That is a shame for such a monumentaly-funded franchise just 10 months after release.
Also, they will have serious problems with catching up Polyphony at this point in too many fields. Even if we presume they can make weather and changeable day/night (they have Bizzare's tech ready at rigs), probem actualy lies in something else - in-game structure and features.
From what we have seen, GT5 will bring drastical in-game structure, new way of execution of carrer, fully licenced career-events, deep and hard-core orientedd online (Track Days and My Lounge section at first), expanded B-Spec mode with Gran Turismo Anywhere function, create&play philosophy through Course Maker and upgraded ownership-philosophy aproach that no other game has yet come even close.
And all of those options/features in-game structure-wise have clearly been made as new foundation, in order to being expanded in the next game (GT6 will obviusly come on PS3 in next 2-3 years). So, everything that GT5 is lacking will probably be executioned oin GT6, in the similar way GT4 delivered 3X more content features than GT3 for example. Having foundations like those just shows what monumental work have they done in previous years, managing the frame they can now expand flawlessly for probably almost a decade. When I see GT5, I see GT6. I see all cars being Premium, I see weather/time of day on every track, I see revamped 3D support (when even more people will actually have 3D sets), expanded Course Maker feature, expanded GT Anywhere feature, expanded online and community features and futher improvements in all fields we probably do not think about. They have knowledge, tech, money and crazy amount of ideas to do it.
I really do not know what T10 - or any other developer/franchise to be honest - have in their sleeves to compete with such a overall-bahamuth as GT5 undoubtfully is.
This way or another, I was very intrigued by the fact Microsoft didn't show us new Project Gotham at this year E3, and in November we will be less than 6 months to E3 2011. All eyes will be at MS and T10 to show their answer at GT5 and it will be very intresting to see what have they done.