July 13:

Arcade: $249
Pro 20 GB: $299
Pro 60 GB: $349
Elite 120 GB: $399


November:

Arcade: $199
Pro 60 GB: $299
Elite 120 GB: $349

 2 Price drops in 1 year after 1 price drop in 2 years... I don't see it happening though woul be pretty sweet if that prediction holds true.

Well, in November the console is 3 years old...

Especially if they go looking for a Wii that they can't find.   It will definately start cutting into Nintendo's sales as the alternative that is in stock.   I have seen it happen with other game systems in the past.  Dreamcast picked up sales that Christmas when no one could find a PS2.  So did the Sega Genesis when people couldn't find a Super Nintendo. 

And like the Sega Genesis, its actually a worth competitor.  But it happens, don't expect any of the peripherals to come down in price anytime soon (especailly that HDDs)  They got to make back the money some how.

The latest rumour is that the arcade model will be $249 and will include the 20GB HDD, the pro will be $299 with a 60GB and the elite $399 with the 120GB.

But will all soon enough.

if the arcade were to be priced at $199 i'd see myself buying an arcade before a wii as i'm currently planning.

199 I would buy instantly. I don't plan on going online. The only game I'll miss is SSFIITHDR

The number 1 reason I don't think it would happen is because of pricing in the rest of the world. The USA almost always gets things cheaper than elsewhere bu THAT MUCH cheaper just seems extreme.

I also think that while MS is making decent money on each 360 sold, its not enough to drop prices that much without going into the red again. I think $229 would be awesome, but unfortunately I even doubt it will go that low.

I have no numbers to back up anything I am about to say, and I am too tired to look; I'm sure someone can find them.

I agree that the U.S. price is significantly lower already but U.S. buyers buy more 360 games.  MS has a good amount of first party games and they still get money for 3rd party games.  The U.S. tie ratio is beyond ridiculous, it's ricoqulous.  I am also willing to bet that LIVE ratio is higher in the U.S. also; along with peripherals, etc.

$199-229 could be what MS needs to stay ahead in the U.S. and make a S-load of money.  Remember MS, unlike Nintendo, is playing to win and bankrupt Sony gaming so they can get MS boxes in more living rooms.  They are making a profit in the short run on the hardware, they can probably pull it off.

I think it is very likely by February and somewhat likely for Christmas.

Reminder, I am far from a MS fanboy and I am not necessarily supporting this move for my taste.

I don't think it will drop that low. Even if they did do that, and it helped sales, it would only be for a little while. Nintendo could just as easily give a price drop to the wii and put it lower than the arcade, and put it back on top.