I've said this before, and I'll say it again -- the problem is, Microsoft made a bunch of bone-headed management decisions which made the 360 uncompetitive with the PS3 over the long haul. Things like (1) no replaceable hard disk, (2) major quality issues, (3) no next-gen DVD storage, (4) surprisingly average DVD playback and media functionality, and (5) lack of investment in a first-party studio network.
All of this was obvious to anyone who followed the game industry waaaaayyy back in summer of 2006. The quality issues are, hopefully, being resolved, but the other problems will just get worse and worse.
It's a damn shame, because the 360 is a fine platform, and the industry needs healthy competition. This is the fault of Ballmer and the top managers, not Microsoft's game division, who've done the best they've could under trying circumstances.
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