MS could basically watch Sony implode. Similar to how Sony bleed as much money as they could out of MS last generation. Sony kept the pressure MS when came to pricing and it's one of the reasons the original X-box had such massive losses. Given the current situation with the currency exchange rates, a $100 price cut on the PS3 would be suicide. Particularly in Europe. The value of the Euro and Pound relative to the Yen has fallen sharply.
Given what we've seen of MS thus far, they probably would cut the price of the 360 and add some functionality to stick it to Sony. The PS3 is the only console that has had its perceived value go down as the generation goes on. Sony continually strips out features from the PS3. The PS3 is not the cheapest Blu-Ray player anymore. It no longer plays PS2 games. It no longer has card readers. Its lost USB ports. It no longer plays SACDs. Etc. Sony is in dire straights. I can't seem them enacting any price cut anytime soon. At the earliest the 4th Quarter of this year and even then $100 would probably be out of the question.
