We also need to take into account newer technologies that help reduce overall game size. For instance, Tegra since the X1 have HEVC/h265 native playback, which can provide roughly equal quality of AVC/h264 at half the bitrate. PS4/XB1 use the latter of these two formats.
I think it's interesting that this argument is used every generation, and then developers add more content instead of reducing file size every generation.