Price cuts spike sales just for a little while, but the dust settles after a few weeks. Right now, the PS3, as MakingMusic said, is more expensive than the 360 and hasn't had a price cut for a while. It's still outselling the 360 WW without it's huge titles having arrived.
There is definitely a difference in consumer patterns between America and Europe. The American consumer goes to a store, sees the prices side by side and seeing that both systems have mostly the same games (alot of people by movie-based games and games not talked about on message boards), and chooses the cheaper option off the shelf. The European customer takes into account that their will be more micro-payments with the 360, like more expensive online service. It also doesn't help that MS is always getting in trouble by the EU for its business practices.
Lets also consider the fact most of the MS exclusives come to PC after a while. PC gaming has an edge in European markets and cannibalizes the 360 market. PS3 has many more games that won't see the light of day on PC.
I think both MS and Sony are in for another price cut this year. Both had profitable Q3 and are doing well enough in their other markets. I think the 40 gig will go down to $300 and the Premium will go to $300 or $280.
Sony has more big guns from different genres. MS really needs a non FPS game that will take the world by the storm like Halo, whether its a jRPG, platformer, etc.
"Naturally the common people don't want war: Neither in Russia, nor in England, nor for that matter in Germany. That is understood. But, after all, IT IS THE LEADERS of the country who determine the policy and it is always a simple matter to drag the people along, whether it is a democracy, or a fascist dictatorship, or a parliament, or a communist dictatorship. Voice or no voice, the people can always be brought to the bidding of the leaders. That is easy. All you have to do is TELL THEM THEY ARE BEING ATTACKED, and denounce the peacemakers for lack of patriotism and exposing the country to danger. IT WORKS THE SAME IN ANY COUNTRY." --Hermann Goering, leading Nazi party member, at the Nuremberg War Crime Trials
Conservatives: Pushing for a small enough government to be a guest in your living room, or even better - your uterus.