Opinions: Will Microsoft make a retaliatory price reduction.

[NJ5]

I think they will do one of the following:

1- cut the price very soon.

2- wait a bit to see how the sales of the 360 compare to the PS3's before considering cutting the price.

Normally I wouldn't admit the second possibility, but now I do, for two reasons:

- the PS3 is selling very bad numbers

- Microsoft has repeatedly stated that it wants its entertainment division to be profitable in the new fiscal year

My conclusion is that they won't let the sales of the PS3 overcome the 360's (they have deep pockets and that's something they don't want), but they won't necessarily cut the price as a pure response to Sony's decision.