I don't see why there would be desperation?
As is, MS are pretty much asured to pass 30M lifetime, which is a good score for a console and asures a decent interest by developpers.
The only reason MS drops the prices is to gain steam because their goal as they announced recently is to beat the PS3, and it's true that with Blue Ray the PS3 has a definitive advantage for a large crowd of people. End of life, if the 2 consoles are at the same price point, I doubt that anyone will choose a 360, exactly because of this, a free BR player, but with the price cuts, the Blue ray player comes at a $150 premium (there is the HD which I counted $50) and thus the price cut make absolute sense to do in a periode where sony has repetedly said they could not make one.
In the US XBox acceptance is evident so it will be effective.
In JP, the pace of Xbox has gone from 2k to 4k recently, the price cuts should put it at a PS3 sales level... and PS3 itself is not in a position where it can claim anything in JP.
In Europe they already had the drop (easier due to $ conversion) and sure it did not have all that much effect, but the market has always been said to be more PS friendly so it kinda makes sense.
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