There's one thing called customer perception, wich is how people in general perceive the console. And since the price cut, people perceive the x360 as the cheaper one, since the $199 price is what catch their attention. When they actually buy the x360, they probably(the majority ) don't think about the additional cost. Several polls about consumer behaviour stated that most purchases are more impulse than reasoning.
At the same time, people who like those in this site, have enough knowlegde about VG to know that the arcade is not the best deal. especially if you want to enjoy all the system(x360) has to offer.
A second point is, the sales are divided between the 3 SKUs, and the totals are just above PS3 numbers. Now imagine that MS cut the production of the cheaper ones and only mantained the Ellite SKU. Do you think it would hold the same numbers? Honestly? Even the pro SKU would be behind the PS3. So the price argument holds water, since the X360 edge is the arcade and the value argument is also valid, cause I reckon this is the main reason the PS3 is so close the X360, despite the price difference, part of the public do perceive this value and thus buy the PS3 instead the X360.
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