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The only way the new Xbox will cost more than the PS4 is if they drastically changed the specs since the most recent rumored ones. And I don't see that happening. However, a brand new Xbox 8 for $199 with 2 year $15/month contract would be fine with me. Even if I spend more in the long run, I'm all for saving $200 up front. It's a $100 extra gain on MS's part if they go that way.

To be honest, though, I can easily afford to pay full price of the machine and not use a plan other than for my Xbox Live stuff I have already. If they add in Cable TV functionality for like $20 a month, and make a "Diamond" tier for $35 a month, that'd be a great replacement to most people's cable TV boxes/services. It all just depends on pricing though.