@ Rocketpig: I suppose Sony has played their hand a bit early, but at this point they don't care about much other than ensuring a larger install base. And with the embedded BluRay player, most people still see the PS3 as better value regardless, so a higher price point is both expected and natural either way.
I don't think the 360 has the ability to move units even if the price drops significantly, the original X-Box was always cheap but never very popular.
I'll grant you that the X-Box brand is more established now than it was then, but people by and large view it the same as its predecessor in most regards.
A name and product that failed to take of the last time around, will most likely struggle during round two as well I think.
That said, MS did make a commendable effort last gen, and sales were good for a debut machine!
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