over time i think the ps3 will be #2 and the 360 will be # 3
and the wii will be #1

Lol.

And no, it won't effect much other than the first month or so...it's an 8-10 year console war, MANY price drops will be coming for all the consoles over the years.

My hope is that Sony will respond with a price cut of it's own, however, they have already stated numerous times that a price cut will not happen this year.

If ever was a time to re-act, now would be it, especially with '08 looking like it does for Sony.

Woops...double post.

 They said the same thing last year before they had a price cut.  Though there was no actually price cut but they introduced cheaper skus to replace the more expensive skus so it was like a pricecut.

SONY will not drop the price of the PS3

(until late summer, earliest)

Uh...I notice one word in there...it just catches my eye...did anybody else see the word "rumor" in there? Or am I just imagining things?

Sony as a whole should be optimistic right now. Blu-ray beating HD-DVD so quickly is a good sign, but there is still DVD to worry about. While it is looking good compared to the last format switch, I would say it would be prudent to stay cautiously optimistic and agressive about getting Blu-ray to the level where it can compete with DVD in terms of sales.

If Sony's game division is anywhere near cloud 9 right now then they have accepted that they will be second place at best. While they have had marked improvements, and are gaining a decent amount of ground on one competitor, the other is still miles ahead and getting further away. They should definatly watch what happens after the 360 price drop and at least have tenative plans to respond in case it works better than what would normally be expected.

A price cut will regain the lead on a more consistent basis in the US for the 360, and bring it closer to the PS3 in Europe, maybe passing it once or twice. That is it. Nothing is dying.

I think second place to the Wii would be more than acceptable from a sales standpoint, considering what a juggernaut the Wii has turned out to be.