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ASStronaut said:
Why does Microsoft not just pound Sony's game division into dust? They have the money to do that.
I would do that if I had the means to.

Hm, MS's actions are heavily influenced by shareholder interests as we can see by Ballmers latest announcement, so I can only assume shareholders might not be too happy if large amounts of money were used to gain control of a seemingly not very lucrative market (well Nintendo did have some very good years, but apart from that?).