I don't think they can afford to drop the Pro/Elite much further past about $250. The question is whether that will be enough.

The only upshot from Microsoft is that Sony won't even be able to think about considering the possibility of another price cut until a year from now.

There is probably another 2 (or maximum 3) good years left in this generation before the release of next generation consoles, and Microsoft needs to stay out in front as a springboard to the next generation.

Yeah, the sales of the Xbox 360 are just going to come to a halt because of a PS3 price cut.

Im selling mine right now. Screw this...I want slimness.

Wow... It's not even holidays yet and it's turning into one heated battle. :-S

On top of the Blu-ray I'd add that the Elite lacks wireless. Not useful for everybody, but something else that even your average consumer will see as a feature when the prices are equal and the boxes are there right side to side.

well if 360 is cut to $249 for elite model, i cant picture anyone buying that instead of a slim ps3.

the only way is a $100 cut on elite to $199

I think the Xbox 360 will see a small price cut (~$20-30), this holiday, mainly just to get the publicity of a price cut in ads. If not a price cut, probably a hard drive added to the arcade and some good bundles this holiday.

At this point, I don't think you can say that the PS3 is going to sell more than the 360 based on Elite vs Slim.

The 360 arcade is still going to be a major factor when it comes down to families on a budget, marketing, and viability.

Also, there's a Halo game this fall. Lets see you talk the 12 year olds into buying Uncharted 2 instead.

That's very much your opinion.

OT: Microsoft will still be able to rely on their strong game line up and momentum (i.e. people will buy one as thier friends have one) to carry sales for some time but they are never going to be able to match the upcoming PS3 sales with the current 360 price. IMO of course.

The problem with adding an HDD to the Arcade is it will jack up the cost of the system to Microsoft without actually providing them with any real mainstream publicity or a drop in the base price.