Lower the Xbox 360 by $25 and make a third-tier XBL (the bottom tier is essentially free online).  Anyone agree?

I don't think a 25$ price cut would be interresting right now. The 360 is cheap enough. if they wanna cut the price, they should be till late 09 IMO.

 WHat do u mean "third tier" Xbox Live?

Make Gold into Platinum, Silver into Gold and a third free tier idk, bronze or something.

Microsoft should make a $50 price cut in late 2009 across all 3 consoles.

And what would these 3 tiers do? And which would cost, and how much?

If there's a PS3 price cut in 2009 (an early one looks very unlikely), I think Microsoft will cut prices before the holiday season.

Four years after launch looks like a good time to sell 360s at half the launch price!

I don't think price cuts will necessarily help the 360.

They are in a magic spot right now where the PS3 is far too expensive.
A lower price won't change that, but a low enough priced PS3 could. Although, I don't think a low enough priced PS3 is possible (and I think that price is $249).

The average consumer wants a Wii, cutting revenue for MS hasn't changed that.
(i.e., MS could have it coming from both ends)

Honestly, I think there is enough momentum in NA and Europe to ensure the 360 stays ahead of the PS3 forever....

In Euorope yes, rufly €250 for a X360 60GB compared to what, €400-450 for a PS3?

But in NA the X360 60GB still cost $300 and needs to come down to the $250 level which did wonders for the sales in Europe.

Platinum would be Gold + VIP perks.  Gold would be the basic Silver now.  Bronze would be like an Arcade entry for casual games (free online).  Family titles could support the Bronze level for free online enticing new consumers and off-setting some anti-MS bias by Sony.