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Reasonable said:

Now, there's nothing wrong with that... but I really think this approach is always going to put a glass-ceiling over MS consoles' head which they will struggle to breach. And that ceiling is where you need to sell beyond this narrow demographic to a more diverse, casual userbase.


 No, that doesn't put a ceiling on them. It's a gigantic advantage. The way the business world looks at it is this; "Hey! We can develop games for the PC that can easily be ported to the 360 because of similar architecture! That's a great reason to choose the 360 over the other consoles! We can appeal to 2 large markets for the price of one!"

In no way, shape or form is that a disadvantage. The 360's Windows-like architecture is probably the largest advantage the 360 has going for it, and it virtually guarantees the 360 will not be abandoned by developers in favor the PS3 throughout this generation. The similarities between the 360 and the Windows PC will result in more total games for 360, not less.