It would not surprise me to see this new cheaper arcade 360 (or whatever it is going to be called) come out just in time for Kinect.
Right now the only difference between the PS3 and 360 is Blu-Ray and the price. Obviously that will sway some people who were thinking of getting a PS3 but the boost won't last for long. Deffinatly run out before the holidays.
So i would expect this new unit and price to happen just before holidays to coincide with Kinect and possibly a PS3 price cut.
As others have mentioned this does make it difficult for PS3 in US, it will never get those numbers back now. But in Europe it still leaves it up for grabs. I personally thought E3 might decide who wins europe but now it looks like it will still be undecided. The 360 has got a price cut to around £99-£119 here. That will shift some units. But it depends on What Sony do, if they price cut it will make things a lot more difficult to predict!
