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justinian said:

What company throws money down the drain? These is business, not kindergarten.

The whole point is to make the xbox division profitable overall, not throw money down the drain. Imagine explaining that shit to shareholders.

On topic: This can be very negative to Xbone sales if true. I will await confirmation.

Sony threw a lot of money away to keep the PS3 sustainable. Clearly they overestimated the demand for what they were selling and had to respond appropriately or lose developers.

It's that last bit that MS is concerned with; maintaining optimal partnerships with their third party developers to ensure that they have their continued, full support. Every copy sold is a licensing fee paid, so that's where the slack will have to be taken up. Sell more games. Hard to do that if more and more consumers are buying into a competing product. 

And yes; rumors like this can have a very negative effect on sales. If I'm Joe Average on the cusp of buying a new gen console and I'm leaning towards an XB1 but I hear that MS might be dropping the price by $100, I'd be an idiot or just extremely impatient not to wait out the rumor.