I do think that as parents we'll always come up against variations of this problem until our children are earning their own wage and living independently. It's either possessions envy or that they wish we weren't as strict as so-and-so's parents, or blah blah blah. Every parent goes through it in one way or another, and as someone said above, our job is to manage expectations - and, also, I would add, to pass on values that will help them live thoughtfully.
At the same time I understand the OP's frustration and also agree that there is a hell of a lot of excessive materialism which children are being exposed to. I am amazed by the range of techy tools that some households have, and, equally, am amazed by the way some parents always make sure their child has the latest toy (not just techy things) before everyone else. This stuff just doesn't matter in life, does it? And to take a wider view, excessive consumption makes us (and our children) more superficial as humans, damages our environment, and (to take a really wide view!) is what led to the recent economic crash.
The TV viewing thing is potentially really dangerous for children. An expert told me recently that in young children excessive viewing has been shown to heavily influence the development of emotional and mental disorders such as ADHD, because their brains are hyperstimulated by the fast-moving images at a crucial time in their neural development. I am certain that this also includes the fast-moving images in video games.
Those of you whose children watch lots of TV/ play lots of video games, do you know how it's affecting your children? I'm sure it would matter to you a great deal if you did know. Why don't you try an experiment of cutting their viewing/ gaming out for a few days and observe how it affects their behaviour? At least you'll be able to see then what sort of impact it may or may not be having, and what, if anything, you'd like to do about it.
We recently cut DS's TV viewing from about 1.5 hours a day over the Xmas hols to 20 mins maximum per day. We did it because he (a lovely, lively but definitely manageable child) was becoming more hyperactive over Xmas. The change was dramatic - and in fact I noticed a change right away. He calmed down and was his pre-Xmas self again. Also, he's taken to it very well - today, after his allotted 20 mins of TV, while I was cooking and didn't notice the programme had finished, he even switched off the telly of his own accord!
So, yes, technology is a part of modern life (and I'm a media chick so don't I know it?) but that doesn't mean we shouldn't use it wisely, particularly where our children are concerned.