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As as been said many times, its most likely the RROD expenses that have held them back from doing some major cost reductions more then anything. If they didn't have that expense the gaming landscape would be different. The wii would still be in first place but I definitely think that had they cut the cost of the 360 at the right time they could have far more effectively competed with the gaining ps3 momentum. However thats all speculation, we'll never really know how it would have turned out.