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justinian said:

Legend

I agree with your statement regarding everything MS has done so far indicates that they are in for the long term.

If the gods smile on them in the future then it's all well and good - as far as 360 is concerned.

If things take a turn for the worse how long are they willing to hold on and loose money in an industry that can change like the British weather in the future. By this I mean that gaming is evolving and new technologies and new players (say for example Google launched a console using this onLive or whatever it is called) CAN POSSIBLY make gaming as we know it redundant...or it may not.

Of course MS will stay on top of things and evolve as well but the huge profits that once was share between the three may not be there anymore.

Disclaimer: Google is just a name I pulled out of thin air and I have no evidence of them planning to launch a console.

 

The 360 business is profitable.  With 32+ million consoles already sold it is much easier to drop the price (while probably still being profitable on hardware itself) and not be affected by the reduction in revenue.  Get an extra year of xbox live revenue from a good deal of the new customers as well.  MS will have 4-6 more years of profit coming from the 360.



Its libraries that sell systems not a single game.