Microsoft can still do plenty. Right now they have the all important "wait and see" card since they are at the advantage and holding the momentum. They can surely drop the price $50 and would have a great impact. At $50 price drop, that would directly compete with the remaining PS2s. Even without a cut, they can bundle, offer free services or add-ons, etc. Their advertising is immense, so if the 360 has some new bundles or cost reductions, EVERYONE will know about it. Can't say the same thing about the PS3. One of the games you mentioned to move consoles, Killzone 2, releases in a little over a month, yet NO TV ads or cinema ads?
I think you are overestimating what Sony can do and underestimating what Microsoft can do. Plus, everyone knows MS releases most of their big reveals and KO punches at E3.
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