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Radek said:

It has to be 400$ to have any chance of competing with PS4 Pro. Regular PS4 (which is already more powerful than Xbox One and Xbox One S) now costs as much as Xbox One - 299$. For 100$ more (from PS4 Slim 500gb) or 50$ more (from PS4 Slim 1TB) you can buy PS4 Pro which has over twice as powerful GPU and 30% faster CPU.
During that year more and more people will be buying PS4 and Xbox One S to play new games. People that won't be satisfied with level of graphics or performance on regular PS4 and Xbox One / S will be either switching to PC or getting PS4 Pro. People that will want to play Forza Horizon 3 and Gears of War in 60 fps and better graphics may invest in Gaming PC before Xbox Scorpio is out, people that don't care about Xbox Exclusives and want something more affordable will get a PS4 Pro. A full year headstart! If Scorpio has 6 Tflops GPU and costs 499$, it won't be any better deal than 4.2 Tflops PS4 Pro for a whole 100$ less . Hell if people say 4.2 Tflop vs 1.4 Tflop (300% difference) is not worth extra 50$ and get Xbox One S 1TB instead of waiting for PS4 Pro, then how do you expect people to pay 100$ more for 40% powerful Scorpio? PS4 Pro is here a year earlier for just 399$.

Microsoft want the "no generations" thing. Why would they try to compete agains the PS4 if they will focus on a "premium" market and will have regular upgrades instead of generations.