Your not going to win the consolewar by making XBL free and only having one SKU.
Multiple SKU's are quite handy so you can pick in what category (= how much you wanna spend on the machine) you want the console.
XBL for free won't push over people that are still doubting. Because PSN IS already free. It would save a lot of money for the people that already have an X360. Not get a lot of new people to buy one.
Maybe if they go down to 100$ in the next months, they can obliterate the rest and win the consolewar. Otherwise, not happening!
EDIT: Selling more than Xbox (original) and NOT having Sony on top would be a 'victory' for Microsoft, because the latter is why they entered the race in the first place!
Remember Microsoft backing the dreamcast with Windows and online etc.. When the Dreamcast failed they flunked out the Xbox to try and halt Sony's advance in the market, because Console/Portable gaming is quite related to PC gaming and Microsoft saw that as a treath!
THE NETHERLANDS
