How close to the Wii could either the Xbox 360 or PS3 get?

[mike_intellivision]

I don't know how much maximizing of profit shares either Microsoft or Sony can do without regard for minimizing losses.

To be honest, I expect as sales begin to slow below an acceptable level that Nintendo will take some action because it will begin to reduce its profits. That will help to recapture market share losses.

Back to the OP, another price cut by Microsoft could shift sales to the 60G Pro version and away from the Arcade version more than it would increase sales. Of course it would get some additional sales unless Sony matched it with a price cut.

A PS3 price cut would result in additional sales and demand for the console. But if it is done too soon, it could be more of a problem that a benefit for Sony. Monetary losses or the inability to meet demand (for a product for which there is an adequate substitute) are not things that you want to see as a business.

In other words, there might be changes at the margins but the essential pattern has been locked in for two years. The only question is whether the Xbox 360 or PS3 get the larger share of the HD console market. Given current trends, the Xbox seems to be in position to hold its relative advantage over the PS3 for the short run. In the long run, a lot will depend on whether the PS3 can lower its price twice.

(Both the Wii and PS3/Xbox 360 have ranged between 48% and 52% since the generation became competitive -- with the share of one console/group of consoles going up while the share of the other goes down).

Mike from Morgantown