Maybe on a more positive note for XBox 360 fans here on VGChartz is that it is also anticipated the XBox 360 will see a sales spike for this current quarter. This mainly due to retailers clearing stock of older XBox 360 models with sub 100 dollar deals.
So I think for the next report it will be the last time Microsoft will blow its trumpets and dedicate the spike entirely to the new model which IMO looks quite a bit like a PS3 wannabe (black shiny casing with touch sensitive buttons and added some features which came with PS3s since launch).
But the holiday season I think will be most revealing, I think unless Microsoft introduces further price drops sales will plummet hard. Kinect may perform OK for North America, UK and Australia though due to mainly the massive overhype it received during the fake Milio presentation (and thus fans hailing it as the second coming of christ, which naturally should push some fans towards buying Kinect regardless of quality). For the rest of the world however, such as Europe and Japan I anticipate a massive sales failure. Everything Microsoft has shown (real demonstrations of software) have been very underwhelming and according to Microsoft (probably due to its entry pricing) is mostly geared at the hardcore initially, this while the bulk of the hardcore gaming community seems appalled with what was shown to them so far.
My guess is that the PS3 will indeed overtake the XBox 360 install base this Sony fiscal year and the year thereafter the PS3 will again gain huge momentum while the 350's momentum will plummet. I guess Microsoft is already planning a new XBox as they probably understand they will loose all their PR propaganda war ammunition next year like was the case for HD DVD (when the propaganda tactics moved towards the non-existant digitial download vs Blu-Ray HD movie format war, cheap movie distribution with a quality no where near to Blu-Ray quality).
