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there is no way the ps3 is going to drop that fast. I mean the whole point is to try to make a profit off the system. Sony won't be making a profit if they keep doing price cuts. But let's say that they do drop the price that much, Microsoft would just drop it even lower since they will probably take a smaller hit for each console sold and they have better software sales for now.

If i was the president of the game division in one of these 3 companies, i would actually rather come in a respectable 3rd place and make a profit than come in 1st and lose money the whole generation.