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Squilliam I think something you might not have noted in your chart is the possibility of a re-design. That is, if the PS3 dropped prices and substantially cut into MS's market share, MS could lower the prices on all current stock, but keep the same price for a newer "slim" 360.

Clearly, at some point in the future Sony could counter-punch with the same move I just think it would be MS's first response to a changing market environment.

I also think that MS is done making moves for now. Even if Sony dropped prices tomorrow and started eroding MS's lead, MS would probably be content on amassing any profits they can from current prices. They have the luxury of time on there side.