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Reasonable said:

I'm not convinced a slim model will make any difference.  I don't see Xbox associated with slim in a way that would make it more desirable.  I could be wrong but I'm not convinced that having a slim model will automatically generate more demand.  I really think it's all about price now for 360 after so many years in the market and with multiple iterations of its main franchises already released.

One of the biggest advantages slim will bring is a psychological break for consumers from the RROD fiasco.  It's a "new" more reliable 360, and I fully expect Microsoft marketing and PR to capitalize on that.

Besides remodels almost always reinvigorate the market (GB Pocket, PSone, GBA SP, PS2 slim, DS Lite, PS3 slim, etc).  And I fully expect the slim to be buffered by a real pricedrop (not simply value adding) on one side and Natal on the other.  It's more of a platform relaunch, and is much the same sort of thing PS3 went through last fall.