A new report from BrandIntel says that Halo 3 captured a huge amount of casual gamer interest.

http://www.gamedaily.com/articles/news/halo-3-appealing-to-casuals-too-says-brandintel/18596/ 

 I saw that article too, but from what I understand of their process they also count people who are just mentioning the game.  There was a lot of buzz around its release for sure and people were talking about the lines, and the hype etc... Basically they are saying because people talked about it they were buying it.  And while that works to some extent, I think there has to be more data for that conclusion to have any weight.

Basically what I am saying is that they will have a hard time convincing me with that type of research that a meaningful number of casual gamers decided to drop a few hundred bucks to pick up a game that is almost the very definition of hardcore gaming.  

Another aspect of the headstart that gets overlooked is the impact of gamerscores and Live.

MS now has a large user base with large percentage "hooked" on achievements and an even larger group hooked on MP over Live. So not only is Sony playing catchup in terms of installed base and their library but now they have to contend with some elements that 360 gamers are not going to give up easily. Obviously both factors can be matched if enough resources are thrown at it but but MS won't make it easy.

Another obvious benefit of the headstart is that the installed base that the 360 has developed is going to draw more and more developers - nobody is going to ignore 13M potential customers ...

So I think the headstart was a key element of MS being able to overcome the momentum Sony had generated with the PS2 and make the PS3/360 battle a much more balanced "war" than Sony had anticipated.

First, a headstart is the best strategy to reach a new level of sales, every generation has shown that. The Genesis sold way more than its precessedor due to its headstart over the SNES, the PS1 was able to outsell the N64 due to a headstart (amongst other factors, but I think this race had been much closer if the consoles had been released at the same time) the PS2 never had to look back to its competitors thanks to its headstart (although I have to say the failure of the Dreamcast is an exception of the rule) and now the X360 sells better than the original Xbox because it had a headstart over the concurrence.

This being said, Microsoft should have profited more from this headstart, they should have tried to get better sales during their first year. The 360 became very strong once the competition was out; before, it was not that much of a factor.

Actually I'd say the 360 helped the Wii by coming out a year early and hurting the PS3's sales

 Insurmountable in America? Probably. Worldwide? I doubt it. There won't be "PS3 domination," but then again there won't be 360 Domination either. The PS3 will pick up steam throughout 2008 and pass the 360 worldwide by mid-2009.

So not only will the PS3 pick up steam even with its 2008 games getting more and more delays, but the 360 will also magically lose the steam it has, while Microsoft sits, watches and does nothing to counter it?

I'm not saying it can't happen, just saying you have to provide some reasoning to back up your claims if you want your post to be taken as more than just another uninformed opinion.

Here's my view:

M$ has benefitted from the head start, even if the Wii is beating it. The biggest thing is ... it launched before the PS3 and that is all that really matters - its direct competitor.

Here's the deal - the reason the 360 is still outselling the PS3 is because of folks waiting to see what it was going to do.

Folks held off buying a 360 in its first year because at the price points, several gamers couldn't afford to buy two $400+ consoles at once. So ... the *potential* 360 and PS3 customers waited to see which console would start to pull away from the other.

The 360's head start, as others have stated before me, offered devs a chance to learn the ropes on the 360 without worrying much about another console at the moment.

Now, the devs are hitting their stride with the 360 - and the install base reflects that. Had the PS3 came out at the same time, it would definitely be a different story. Folks would have leaned toward the PS3 because of the past successes. Sony would have kept the 20gb and 60gb with full BC - and had no need to make an 80gb. M$ would be backed into a corner, pretty much like the PS3 is in.

Now, devs are finding it's much, much easier to develop for the 360, the user base and attach rate is unreal and they are realizing the main reason for the PS3's user base being high is due to the way Sony's touting it - a Blu Ray player that plays games too. Think about it - why buy a standalone BR player when you can get a video game console that plays video games and BR movies for the same price, if not cheaper?

And folks are responding. The potential customers, PS2 owners, aren't as impressed with the high price point, lack of features AND dazzling gaming lineup of the PS3 and are turning to the Wii or 360. With the arcade price cut, folks are taking all this to heart ...

M$ has the clout to start demanding exclusives (or lack thereof). Sony will have to settle for scraps - nice, pretty games, but ones that won't move systems. And seriously, it would take an act of God for Sony to make a comeback ...

The only person who made a comeback like Sony's attempting was Lazarus ... and he was dead for just a few days ...

 I highly doubt that any of the AAA games for the PS3 are going to be pushed out of the 2008 calendar year altogether. Taking that into account, 2008 will be much nicer to the PS3 than 2007 was. Yes, the 360 will always have a price advantage over the PS3, but the PS brand name coupled with a reasonable price point and good games will push a lot of people toward the PS3 camp (over the 360)... and to an even greater degree outside of the US (where the 360 will retain an edge in drawing consumers for the remainder of this generation). I know how unreliable anecdotal evidence is, but people in many other places have heard the same thing: a good deal of people are just waiting until 2008 when the price and games for the PS3 are finally reasonable and good. Moreover, it's impossible for the 360 to go anywhere in Japan (even it sell 1 million, the PS3 will most likely have pushed 4-5 million in Japan at the very least), and it will probably end up conceding victory to the PS3 in Europe by a few million as well (mostly due to the Sony-bias of the continent), more than enough to make up for and overcome the lead the 360 has over it in america.