With games of course. Yeah the price drop was nice since it wasn't that much it was mainly used as a marketing tool to just say that there was a price drop.  You now see it advertised on all the retail chains that there was  price drop to get people in even if it was just a few bucks.  Well that is one aspect but as I mentioned in my first sentence it is the games that will keep the sales brisk. 

 It all started in August when Bioshosck became a AAA title thanks to the great reviews then followed September with Halo 3 as another AAA and now we have October with the Orange Box which might be rated even higher then those two.  For Novemeber we will have what I consider to hopefully be the best game of all in Mass Effect.  That would be 4 AAA tittles basically only available on the 360 (the orange box is coming to the PS3 though due to at least a month delay just won't really count).  This is what MS was planning all along as their main strategy for this generation.  Get out early to rack up the games and hardware sales will follow.  Well I think it has worked out great and puts them in a great position for this generation. 

Of course as someone else mentioned the 360 bundles are probably the true counter though again it comes back to games.  Why drop the price when you can throw in some games instead.  The game selection works out great especially with Marvel Alliance since I think most people would enjoy it most with 4 people playing which means more accesories being sold.  There is also a call of duty 4 bundle which if that games turns into a AAA title with so far all signs pointing towards that being in the case then is another winner for the 360. 

 Basically almost everything MS does with the 360 cames back to games being the focus which means gamers are the focus.  That is how you counter the PS3 price drop.

I think MS will play it cool like with sonys last (kinda) pricedrop, first they will wait and see how the 40Gig flyes and how the new bundles are doing, if the 40Gig really takes off MS can counter any time but I think they will wait till spring... maybe GTA4 time to earn as much money as possible... MS knows they will winn any price battle, the question is if they want to.

I asked myself when I saw the price drop for the PS3. Isn't that a risk I mean sales will increase for sure but will that be due gamers or people who wants to buy a BlueRay player ?

I think the 40GB PS3 is nothing more than a joke and a terrible move by Sony, MS don't need to do a thing, Falcon integration on all units and a tiny price drop at Xmas will have MS laughing.

@thibje: Right now Sony doesn´t care, they need a bigger install base fast, but yes if software sales don´t follow it won´t do them much good, the real problem I think is that they might sell more consoles now but need to sell much more in the long run to get a good profit and ceep shareholders happy.

Sure, with 360 it's all about the games. Too bad you can't play any games until your unreliable 360 comes back from repair. But be happy, it should not take longer than 4 weeks for you to be able to play your awesome 360 game collection ;)

On the other hand, me and my shitty but reliable PS3, have no freaking good games to play. My current PS3 collection (Resistance, Ninja Gaiden, GTHD, Heavenly Sword, Vegas, Motorstorm, Warhawk, Oblivion) sucks so bad that the only time I use my PS3 is to watch trailers of the unproven new franchises of Haze, Uncharted, LittleBigPlanet and Killzone2. Of course, these franchises will suck even more than Resistance and Warhawk so my only hope now is that MGS4 and FFXIII are any good.

Start the flames please, I'm bored at work and want to have some fun :)

^^ *gives krik a hug... but ceeps huging him tightly so both Sony and MS fans can wail on him*

@Duderino... GTA4 was delayed to Feb-Apr 08.

No reason to flame as you have all valid points.  My 360 is being sent for repairs for a second time and yes that means no 360 for about a month so 2 months without my 360 so far in the 13 months I have had it for.  Hey I know it sucks but I still have 11 months of great gaming and I am hopeful this is the last time I will need to send it back in.  But if I have to send it again a few months later I do have my warranty so off it goes again as long as I get it back to continue playing the games I enjoy. 

 Also that is your PS3 experience which is nice versus my cousin who has ZERO PS3 games though to be fair he has a Wii and 360 as well.  Is nice that your suporting the first/second party games for the PS3 and picking up "old" games like ninja gaiden, oblivion and vegas.  If I could I would buy a PS3 but I only had any money to choose 1 system with the games that I most enjoy playing and that currently happened to be the 360.  I think that is about the same for most single console owners which buy the system they will play the most games for. 

Again no reason to flame especially in this thread as I am mainly pointing out what I think MS did to counter the PS3 40  gig version.

@KurzeS: I know, that was a typo sorry :), spring about the time I expect the next 360 pricecut, they want to make all the money they can now, then when sales go down in springtime they can counter the PS3s games with another (hopefully bigger) pricecut...