Reasonable said:
I have to say I doubt that. Why on Earth would the retailers take a hit for MS? They don't need to. It's much more likley these are vendor funded promotions with MS taking the bulk of the hit. In consumer electronics the retailer very rarely takes the bulk of the hit for deals like this. When you see Sony TVs promoted Sony is paying for it. When you see Samsung TVs promoted Samsung is paying for it. That's the way it is normally. The retailers would rather sell less 360s for more profit margin than more for less. I doubt MS is paying for the whole shebang of course - but 50/50 split is the normal start point.
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Of course you doubt it Reasonable 
We've seen stores like Wal Mart make a loss on $99 Wii's with Nintendo making no losses, just to get people into the stores. Given we don't even know if these bundles even lose money for anyone, it's not hard to imagin retailers are taking less profit on 360 HW when it's selling by far the most SW, as the current king of American gaming it's obvious they're going to be doing this on X360, especially as the Wii and PS3 got prices cuts these years.
