Well, for a start MS is already somewhat in a bind as the Arcade is already the cheap console in Others and we know how well that went vs Wii and PS3 sales. Pretty much every week the 360 is in last place low Arcade price or not.

In US it likely will drive better weekly sales, particularly due to the economic woes facing that territory right now, but I seriously doubt it will make enough difference vs the Wii and while it may force a reluctant price cut from Sony I doubt it will truly make much difference there in the long run.

MS has improved a lot this generation, but if they were truly hoping to take the number 1 spot this gen and capture the market that ship has already sailed globally IMHO and in many ways I think the price cut is about hanging on to as much US market share as possible in the face of Wii domination and PS3 steady gains.

itll help a biy buy noy a lot

Well good thread, i think 199 price for the 360 has some potential, but as i said earlier in the UK Arcade Bundle is arleady at the price of the Wii Bundle but many Arcades arent sold, and Wii still sells like crazy (MKwii just insanely)

In the US of course 360 has a lot more focus on, much more marketing and appeals to US gamers. But demand for the Wii is so high, that i dont think it sales can be affected, low price might push some Arcades but it wont really hurt the competition.

Nicely done mrstick. 

The price cut is no different than any other price cut for a console, not sure why this one is such a big deal.  Only 2 since launch(3 years) is doing pretty damn good.

The Xbox360 is in much more demand in the U.S than the E.U so the price elasticity of demand as the price approaches $200 is much greater. Therefore the Xbox360 will recieve a much greater % increase in sales for any % decrease in price. This goes beyond any economic woes the country may be experiencing.

itll improve sales in US but wont help weaker sales in Japan and others

This price point for the arcade model will certainly help, $199 is the sweet spot. However Microsoft created on inferior Xbox 360 in the minds of gamers. They did the opposite with the Xbox 360 Elite. Although the cheapest Xbox 360 will soon reach $199, I believe that Microsoft still need to reach their sweet spot. I'm referring to the Xbox 360 Premium. When this version reaches $199.

I also think Microsoft will drop out their Arcade model, before the end of 2010. Because they price difference will be too small between their models. Eventually the arcade model will become irrelevant.

This price drop will only slowdown Sony and won't effect Nintendo that much. Sony needs to drop $50 within 6 months. The gap won't be different after these 6 months. Nintendo won't drop for at least 12 months. There might not be a price drop beyond 12 months, but simply add in motion plus to the bundle.

Actually its the fact that there is no HDD which will allow Microsoft to scale the price of the Arcade SKU all the way down to $150 or less. The HDD is more or less a fixed cost and it doesn't scale down in price nearly as quickly as the other components. This means theres no reason why an Xbox 360 Arcade couldn't eventually be cheaper to produce than the Wii will ever be. *This is a product of the design which enables the whole system to be scaled down, whereas there isn't much room to cut costs in the Wii*

It looks abit like a desperation act to me. Don't get wrong it will help sales, but come on. Not even 3 years old and at $199 already. I reckon it will help the 360 sustain at 150,000 ish. Because Japan is a lost cause really and Europe is on lock down from Sony and Nintendo. United States is where it should help, but who knows.

As for Nintendo, it won't bother them at all. They will be at 320,000 Wii's per week no problem.

Sony will be fine, i mean they are selling a $400 console extremly well, when that hits $199 about 2011 ish and when all the big games are out, i wouldn't be suprised if it could sustain 250,000 a week if not more.

The hard-drive is a fairly major problem because the manufacturing costs and materials never seem to come down in price enough to (truely) make the device inexpensive.

In my opinion, Microsoft's biggest mistake this generation was not including 2GB to 4GB of flash memory on the motherboard as a way of saving games by default and giving people access to (some) downloads. Had they done that the core XBox 360 would be (about) as inexpensive as it is now, and people would be far less likely to see it as being a "gimped" system.