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starcraft said:
The problem with this is that those prices will struggle to compete with a $399 PS3, even if the PS3 is dummed down. You cant have a blu-ray-less console at just 50 dollars cheaper even if it does come with good games and have access to a better library. it also has a smaller hard drive

I have to disagree since most gamers are buying a system to play games not blue-ray movies.  I am strong believer in games lead to sales and the 360 has alot more to offer which is far greater then the price difference.  Obviously we will see how this turns out fairly soon though I have faith in games over price drops.