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mrstickball said:
Mega, the issue isn't that Sony's prices won't come down, but the fact that they come down at the same rate for the Wii and X360 via Moore's law. So for the PS3's components to drop by $100, it's going to still take around 6-9 months to do that (if not more), and the other console's component prices will drop another $50 in the same timeframe. But since Nintendo and Microsoft make money on each console sold, they're in a much better position to drop their price, or incentivize their console.

The point is,  Microsoft has reasonably about 100$ of space to cut their prices and at that point,  that's about it.  They won't be able to go much lower.  The one advantage that Sony has is that it has a lot of flexibility with price as long as it is selling competitively.  (Continued software support and good exclusives will aid this process). 

The price of the products inside the PS3 will drop faster in price than the ones inside the 360,  I would imagine.  DVD drives aren't going to get much lower for example (And actually will increase in price if Blu-ray were to ever maintain more of the market).  Yet Blu-Ray drives will significantly keep dropping in price over several years.