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They might try, but they'd best be careful about it. The people bitching about Nintendo betraying the hardcore will be nothing compared to a revolt against Microsoft, and the hardcore is all MS has.

There's not really that many third party exclusives left to woo away from Sony, either. Quantum Theory is the only one that comes to mind, since Yakuza 3 is coming too soon for a day-and-date release, and neither would be a big deal, anyway. Sony is making their own games now in a way they hadn't during the PS/PS2 years. Microsoft may have to do the same.