They should cut arcade by $50 during the holidays. It'd pretty much finish Sony if things go like they did last holiday season.

When were they expected to put out the Valhalla chipset revision?

They may be able to cut the price in lieu with their own cost savings.

Valhalla was on the roadmap for 2009 or early 2010. Though since the leaked roadmap is old, its extremely possible that the plans have changed.

I have said it before and I will say it again (http://www.vgchartz.com/forum/thread.php?id=80627&page=1): MS needs to drop the price of a 360 to 1 dollar.

It is amazing how many still believe in MS's win at any cost mentality.

Throwing away revenue for the sake of a secure second place will please the fanboys but I am not so sure about that pleasing the shareholders.

The future hold no guarantees and profit (or less losses in this case) is more important than planning for a future in a console market that can turn on it's head.

Apple makes 20% of all profits made in the mobile phone industry with a tiny 1% share of all mobile phones by selling an overprice product (overpriced in my opinion).

They sell not as many expensive Macs as, say Dell, but the profit margins are huge.

MS has the cheapest console and some want them to make it cheaper. Why?

There may be complications comparing desktops and mobile phones to consoles but ultimately they are all made of chips and plastic and in many ways do the same thing.

I believe MS should not drop the price and let natal (or the anticipation of natal) sell the consoles. I am willing to bet this will be the case as long as the current versions of the 360 are being sold.

It's the same mindset as those thinking Sony will cut the PS3's price despite the fact that the company is currently having a hard time of it.  Or those thinking Nintendo will cut price even though their system is still selling amazingly well for a video game console.

As for winning at any cost, the fact that Microsoft has already lost billions and is still in the game and showing no signs of stopping should indicate how far they're willing to go.  Also in my opinion it's not just about winning this console generation, it's about establishing a major presence in the livingroom in order to hedge their bets over where convergence is taking us.

Legend

I agree with your statement regarding everything MS has done so far indicates that they are in for the long term.

If the gods smile on them in the future then it's all well and good - as far as 360 is concerned.

If things take a turn for the worse how long are they willing to hold on and loose money in an industry that can change like the British weather in the future. By this I mean that gaming is evolving and new technologies and new players (say for example Google launched a console using this onLive or whatever it is called) CAN POSSIBLY make gaming as we know it redundant...or it may not.

Of course MS will stay on top of things and evolve as well but the huge profits that once was share between the three may not be there anymore.

Disclaimer: Google is just a name I pulled out of thin air and I have no evidence of them planning to launch a console.

I agree with this.

I'd say they should add more value at the same price in the 360 SKUs instead of dropping the price again. Give Pros a lot more HD space, either eliminate Elite or bundle Elites with a bunch of the hottest games, and then maybe even throw in a hd on the arcades...

The 360 business is profitable.  With 32+ million consoles already sold it is much easier to drop the price (while probably still being profitable on hardware itself) and not be affected by the reduction in revenue.  Get an extra year of xbox live revenue from a good deal of the new customers as well.  MS will have 4-6 more years of profit coming from the 360.