Let us clear up a few things that people seem to not understand.
Microsoft has NOTHING to do with the recent Arcade deals going on at Wal-Mart and Amazon. Wal-Mart did this as an early black friday deal and Amazon followed suit to match them. Secondly, the deal was not for a $99 Arcade, it was a NORMAL priced $199 Arcade that came with a $100 gift card that had to be used on DIFFERENT purchases.
Next item up: Microsoft has not lowered the price of the Arcade or any of their SKUs and there has not even been a rumor that says that are even thinking of another price cut. There is no reason for MS to lower the price on their SKUs since they are acutally making PROFIT on their hardware. Sony may be selling more hardware, but too bad they are still LOSING money on every unit sold. So, all Sony is doing by selling more units is losing more money. I believe that was the dumbest thing they could ever do since they were posting a loss in every single quarter as a company already.
MS doesn't need another price cut at the moment, but they could put a dagger in Sony at any time considering they have been profitable on hardware for quite a while now, is making massive money with exclusives like ODST, will outsell PS3 2 to 1 with MW2 starting tonight, have Left 4 Dead 2 next week, doing well with other exclusives like Forza 3, and we can't forget that as a company are raking in massive profits because of the recently released Windows 7 operating system that will surpass XP as the number 1 operating system in the world in the next 1-2 years easily.
To make things short, MS is doing great money wise, Sony is drowning in losses, so even if PS3 outsells the 360 for the holidays or the year it doesn't matter because MS wins either way in terms of major profits compared to major losses...