They gotta do something.

I honestly think they've done about as much as they can to try and beat Sony. I think they've sort of given up at this point and are just trying to make what they can.

They're probably more concerned about making Windows 10 a success than X1.

this. they put up a valiant effort and its ok to take the L on this one IMHO

Has Xbox ever been about making a profit for MS as the first concern? MS only got into consoles as a defensive / disruptive strategy because they were afriad consoles would be a trojan horse that could one day replace Windows as the dominant PC platform (not sure how they ever got that idea but...) and also OpenGL could threaten the primacy of DirectX. So with those motivations in mind profits from Xbox were of secondary importance to ensuring the continued dominance of Windows and DirectX.

If MS sees a broader strategic interest in maximising install base then they may, because they can, be willing to sacrifice revenue and profit for market share. However, if MS no longer sees game consoles as a strategic battle for OS control (which it isn't, and probably never was, though it probably was/is a legit battle for DirectX vs OpenGL) then they may say that if Xbox is to survive it must consistenly contribute to company profits and not be a drain.

As we are not really privvy to MS business strategy it's hard to say whether market share or profits matter more to them. My gut tells me they want better market share, and that they would see falling further behind PS4 by losing Nov and Dec NPD (they will win Oct NPD whatever happens IMO) as a terrible outcome. So I expect they will drop the price in response to a PS4 price drop.

Sony probably has figured MS would drop the price, so they might be planning the timing for a price cut in the USA in a way that would make it hard to MS to react. Though with what Spencer has said, I think MS pretty much has its figurative hand poised over a price drop button with all manner of promotional material and advertising at the ready.

Of course if PS4 dropped to $300 (unlikely I would think) MS would be pretty screwed with its pricing, because I don't think they would be able to drop below $300, so they would only drop to match PS4. I think a $50 cut is the more likely cut for PS4 though.

If they do another $50 drop would halving the standard edition console price in 24 months be a record?

Edit: ignore me, my math failed me.

For the year PS4 has more exclusives.  That means those exclusives will be cheaper and possibly have holiday bundles as well.  Just because something like Bloodborne came out in March doesn't mean someone could have waited till Xmas to get a PS4 and it

Perhaps we should ask Sony.

The thing is, MS is a massive company and Xbox is but a tiny part of it. If Sony goes overboard here, they could strike somwhere else. What if they actually do get AMD? They could pay Sony back for this abuse with different kind of abuse ;)

I think it may not be worth it, cause if you sell millions of consoles for $350, you get millions of $50 on your account and Sony is a company that can use every single $ it can get. The war has already been over a long time ago, so now they have to analyze the market very closely and milk it in the best way possible.

This sais, I'd love a $300 PS4 ;)

Only during BF