Microsoft is having trouble keeping up, the ps3 still cost more, and the 360 still has easily the better games, and is considerably cheaper.

lets see:
360 core
360 arcade
360premium
" with hdmi
360 elite

ps3 20gb
" 40gb
" 60gb
" 80gb

and also realise that each region has no more than 2 sku's on sale at the moment for ps3. 360 has all 3 sku's in each region.

Last time I looked at the charts 360 is still a good 7.25 million ahead of PS3... Now that we are entering the slower season I don't see PS3 catching up any time soon. 360 is far from its death bed.

And if Microsoft needs to they can sell a blu-ray player as well.

since when is a video game systems future determined by a movie format?
the 360 doesnt come standard with hd-dvd,and yeah i think hd-dvd will eventually die....but i dont think it will have any effect on the 360....at all

Keywords, first year...

@Zack

¿how could they have troubles to keep up if they haven't made big price cuts to spice up the sales?

PS3 and X360 have always been like 6-8 million apart from eachother... The closest was when the PS3 had just launched in the EU (6.5 mil) and the furthest was like 7.8 mil i believe. Now, it's at 7.3 something so i really don't see PS3 catching up with the 360 when they keep selling almost the same in 2008...

If Blu-Ray becomes the dominant format (which seems likely at this point) then the overall boost to the PS3 from having a built in Blu-Ray player will probably be similar to what the original XBox received from having XBox Live. Blu-Ray and HD-DVD are really nice formats, but they have a very long way to go before they become mainstream ...

Over the next 18 months we will move towards every movie released by a movie studio will be released in an HD-Format, and movie rental places will start to carry a small quantity of all of these releases; this will be a major improvement over the current state where most video rental stores cary a tiny quantity of the most major movie releases in an HD format. Move players will come down to the $100 range and most new laptop and PCs will come with a built in HD-Format drive. At this point most 'average' consumers will be willing to start to consider buying into a HD-movie player; for those on the market for a gaming system the (then) $300 PS3 which has a built in Blu-Ray player will be a good bargin, but for the (roughly) 70+ Million people who will own an XBox 360 or Wii the PS3 will seem redundant and expensive when they can buy the main feature they want for $100.

It will ALWAYS (unless sony becomes THAT desperate) cost more, but ps3 had to drop its price to become a smaller margin to KEEP UP. 360 can now cut its price whenever, then moving itself ahead, and sony can of course..........if they want to keep bleeding which i doubt with blue ray winning now.

I doubt that this generation the addition of blu ray will mean as much as the ps2's inclusion of a dvd player.

It may add some sales for people just wanting a blu ray player, but if they don't buy any additional games does it really help the system.

Also with a much cheaper Blu-Ray player and Blu-Ray/HD-DVD player comming out, one can only wonder how much longer what little appeal Blu-Ray has will be a benefit to the PS3.