The economy will have the same impact on all 3 console manufacturers. Nintendo is in the best position because they have tremendous sales at an attractive price point and they make money on each sale. Both MS and Sony lose money on each unit sale and hope to make it up on software sales.
In this economy it is best to focus on profitability and revenue. MS needs to sell substantially more units to achieve the revenue that they were earning prior to the price cuts. Using the Arcade as an example, to achieve 30 million in revenue the arcade can sell 107k at the "original" clearance price of $279 per unit, but at the new price they need to move 150k units to achieve the same revenue of 30 million. MS needs to sell 43k more units just to have the same revenue. I am not sure MS would have cut the price had they known how bad the economy would be.
Thanks for the input, Jeff.
