If they had just made another SKU at 700 dollars with a game packed in and a little more hard drive and not dropped the price of the current one then I would have said it is a stupid move.
But when they are just giving you the option of the console for 500 or the console with a pack in game for the current price then it sounds like a pretty smart move, especially that they are trying to lose less money on each console.
Thanks to Blacksaber for the sig!