A price cut would definitely help the PS3, but it wont happen for some time. The Xbox360 in the meantime could gain some serious ground in the European market. Even if the PS3 recovers in the long run they lose out to the 360 for the time being along with all the potential revenue from software sales. Especially in the case of multiplatform titles. Moreover, if people realize they can get the same game of equal quality on a cheaper console they may just decide to stay with the 360. Even with a price drop the PS3 could never go as low as the 360. And the 360 too could see further drops.
It also depends on the timing. For 360 this drop could not have come at a better time, at lease in terms of pushing consoles against their main competitor. It will generate more sales than expected. Will Sony have the same kind of luck? If not, they may have more problems. But who knows? Its just a wait and see kind of situation.
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