Recently everyone went insane about tesselation. Like every other shitstorm, there is a lot of BS about it.

So to be clear: tesselation itself can only smooth objects, not make them more detailed. The "magic" comes from displacement mapping -- and it's not that easy.
For example I was browsing today Gamedev.net's Image of the Day forum and found this example of tesselation:

Can you tell me that in above picture, tesselation is state-of-the-art technology, allowing extreme 3D experiences? Would you believe yourself?
I would split all bump mapping effects into 2 categories: flat surfaces & others. For flat surfaces we have wonderful raytrace-in-pixel-shader solutions right now, like relief mapping or my favorite Cone Step Mapping. Look:
from Bruno Evangelista Detailed Surface
Apart from lighting which doesn't match (due to some shader errors probably), can you tell the difference? I mean, can you tell which is tesselated and displacement mapped and which is raytraced in pixel shader?
But flat surfaces are (very) easy case. What about complex meshes? The truth is: both parallax and displacement mapping will help as very little. Have you ever tried to bake heightmaps to use them will those techniques? There just aren't any tools available that would create good heightmaps. For this reason most games stick to normal mapping for complex meshes (or eventually do parallax with very little height which doesn't improve quality much, but can provide nice artifacs -- and that artifacts are growing along with parallax strength). Sure, Unigine graphics team could spend a lot of time to polish their dragon's textures -- well, thorns are quite easy as you can grab flat polygon and draw a circle with gradient on it:
But what next? How long does it take to create ready-to-use mesh with real displacement map? I'm not saying that tesselation is bad. It's just greatly overrated.
BTW: Displacement mapping seems to have advantage about silhouette modifications. But look at this:

It's from Nvidia's SDK -- pure parallax mapping with fins extrusion. And look how does the shadow mapping work on parallax mapped surface. Now, this is something!
