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It makes sense; cheap point of entry to VR and still most powerful gaming console on the market at the cheapest price.

Neo I reckon will be priced similar or slightly more than X1S.

They will have 2 very well priced consoles, one which will trigger impulse buys and the other that will be better than a premium slim, more powerful and offer VR. If the Neo at 4.2TF is at least $200 cheaper than Scorpio, it will be really interesting to see how things play out.