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Well, that is making a couple of assumptions which I'm not certain can be made ...

Support for the XBox dropped off so quickly after the release of the XBox 360 because the original XBox could not be manufacturered anymore (due to licencing issues) and most games that were under development for the XBox could be released on the PS2 or ported to the XBox 360 (and in many cases both) and remain viable. From my (limited) understanding Microsoft was far more careful about licencing agreements than they were with the XBox, and so many HD console games are multi-platform because they need to be released for both platforms in order to justify the development costs ... As long as the PS3 is on the market it is highly likely that the XBox 360 will share the bulk of third party games with the PS3.

At the same time, the release of the XBox 360 didn't seem to have much of an initial impact on the market-leading PS2 but it did seem to have a huge impact on the Gamecube. There are two reasons for this, there are finite development resources and reshuffling resources towards a new console tends to come at the expense of the lowest selling consoles on the market, and many selling features (like advanced graphics or Blu-Ray playback) can often be dramatically improved upon in the "Next Generation" console at a very affordable price ...

In other words there is nothing that is saying the release of the next XBox system would have a dramatically worse impact on the support that the XBox 360 receives in comparison to the PS3, and there is nothing saying that the PS3 wouldn't see a decrease in sales.

Good point. I had not thought of the reasons why Xbox was discontinued so fast due to licensing. Also due to the strong 3rd party support for HD multi-platform games I definitely agree with you that the Xbox 360 should continue to be profitable and sell for much longer. This news could even sway my prediction on 'final' generation winners with 360 staying in 2nd place if it also goes the distance towards a '10 year life-cycle'.