I've noticed that over the years, the price on software drops faster and faster, especially used games at Gamestop. However, new games drop to $40 then $20 just after a few months. They may have to keep hardware prices up longer to compensate the lower profit on software. I was surprised how long it took the PS3 price to come down, and I am even more surprised how hesitant they are to drop the PS4 price.
I have found in mzy area (Ab, Canada) that retailers have become a lot tougher, games disappear off the shelves instead of getting endkess discounts. I feel like Wii/ HD twins wass peak discount time...but maybe that is just here?
As for HW prices, I don't know if Nintendo, Sony or MS get lower "cuts" just because the games are discounted...seems unlikely. But true for first party sw, for sure. I wonder if Satoru Iwata has had anything to do with it? He noted that GameCube got only a small temporary boost fromthe 99 price cut, and I think he correctly identifiied that increasing value with great games is better than price cuts. Definitely influential on Nintendo pricing, maybe leaked over to the competition?