MS answer to the Sony cut was mass bundles, mass $100 giftcards all over the US and mass advertising with Kinect.
It almost worked. They put up a great fight, just like last Year, but it still wasnt enough (pre adjustments), to beat the PS3 for the Year.
Last Year they had Move and GT5 to fight against Halo, Fable, Kinect and "$500 million".
This Year they had a $50 cut and Uncharted 3 to fight against Forza, Gears, Kinect and mass $100 giftcard bundles.
Add in that the 360 has had exclusive advertising on the 2 biggest games of the Holidays in MW3 and Skyrim... You cant watch a TV channel without seeing a 360 advert at least once