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Be quick to point out a simple fact: if MS didn't have to set aside over $1bn to cover future RROD defects, the 360 would very likely have seen a more aggressive pricing strategy in the interest of maintaining hardware market share.

That is the real reason why we've seen only one very modest price drop across the product line after 18 months of sales. Not because "it's been selling so well we have had no need for more aggressive price cuts!"

Just going by historical console pricing, the 360 should be retailing for less than what it is. If it hadn't been for the RROD extended warranty, it would be.