I think a lot of people would consider a $99 price point to be "competitive" but when it comes to marketing, it's easy to justify any price within reason as competitive when you start throwing in reasons like R&D costs, marketing costs, "added entertainment value," "unique experience," whatever.
Their marketing guys could even resort to busting out charts showing the cost of Kinect relative to a full set of Move or Wii controllers demonstrating how it's actually cheaper, which still doesn't change the fact that you'd still be paying $149 for a camera.
I would hope to see a stand alone peripheral for $99, at least for the Kinect port ready 360 S, but it may well be that the only way to get a $99 Kinect camera is buy buying a $299 Arcade bundle or $399 250GB bundle.
