@TKC-Muzzer
The difference between Microsoft and Sony is thus. Microsoft waited to reduce prices until the production costs justified the reduction. Sony was compelled to reduce prices in order to save their console. You cannot rationally assume that Microsoft is playing the same game as Sony. Microsoft is not cutting prices below production costs. That is why their price reductions were and have been long in coming.
Further more Microsoft of the two could actually afford to loss lead for an entire generation with little detriment. Not simply because Microsoft has money to burn. Microsoft invested heavily in secondary revenue streams. They have the Live service that has and will bring in billions of dollars. Microsoft focused on a demographic with a higher install base which also meant greater attach rates, and higher licensing fees.
I know that you want to believe that Microsoft is somehow losing for winning, but the reality is that Microsoft is winning for winning, and Sony is still losing for losing. To make matters worse Microsoft has a strategy that allows moves from strength to strength. The higher the install base is the more money rolls in. Unlike Sony Microsoft does better in the short term for selling more.
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