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Mikmster said:
Accept reality and 2nd place, make it as financially viable product as possible.

Exactly.  It's the best they can do. The sooner they initiate a price drop the sooner Sony will respond. The $50 difference isn't threatening, but a $100 would cause a reaction.  The Xbox One component costs are rising and no cost saving revisions have been made at this time; however the component costs of the PS4 have lowered and a cost saving revisions has already been done. The PS4 has a huge advantage going forward.  If Microsoft does drop the price more, what happens when Sony responds?  A $199 Xbox?