I don't see this hitting big numbers if it's going to cost people...

By christmas of next year what I expect to happen is that a Natal 360 will launch at 299 while the elite will drop down to 199 and that the arcade model will not be on sale no more. I expect Natal standalone to cost 100 maybe 125 with a game so that people buying the Natal 360 will get a better deal than buying a console then standalone Natal. Hey who knows we will have to wait and see but people already trying to guess a price based on just the statment in the op is kind of silly as there was no base line given only the fact that it will lower in price after x amount of time

celticwolf: MS would never stop the arcade model, it needs it ALOT, they will always keep a arcade like model to cut production costs

So, like every other consumer electronic device, it will start at a price and decrease over time.

Wow

Pricing can be an issue, but while not earth shattering what would concern me more is software.

.....Right now Microsoft has yet to show console moving software for Natal. To compare it too Sony's "Sphere" recent software announces, neither motion controller from the either company is aligned to move units.

i have a feeling natal might actually end up being the new xbox console.

And to profit from peripheral sales, don't forget that.

In what way is bundling a game with a peripheral a bad idea?

How many people would have bought the Wii Fit balance board if it didn't include Wii Fit with it? 

um.. K

Anything above $100 for the stand alone Natal will impact sales significantly. If MS believes in Natal and thinks it will extent the cycle another 3 years or so, they have to go long and be aggressive with the pricing. They need a bundled Natal with HDD for no more than $300.