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I think MS will drop price first and Sony will soon after. I hate MS but i am also not an idiot and see that they are in better position to drop a price. Sure Sony maybe reducing costs but MS can afford to take higher losses so even if they do not do enough cost cutting they still have the cash to take the higher losses. SOny already took losses and most likely would want to avoid going back into the red(i think they are now breaking even on HW).