As with all businesses, Microsoft will only make a price cut when sales slow and they need to re-invigorate them. It makes no commercial sense to cut the price of a quickly selling item.

Anybody who thinks that Microsoft, Sony or Nintendo have a pricing plan, with drops at specific intervals, prepared before the console launches, that they stick to unwaveringly needs to pass round the name of their dealer.

Microsoft certainly didn't plan to drop the Xbox price in the UK after only six weeks. Sony won't drop the price of the PS2 until sales slow down very significantly.

They may plan for a price cut after a certain length of time, but they won't stick to it blindly without paying attention to how the product is selling at the time.

Tons of people whining away on internet forums that "Microsoft should cut the 360 price to undermine the PS3" or "Sony are too greedy, they should cut the PS2 price now" won't affect how these companies look at how they price their wares.

And still you have the small fact that slicing the price with a 100 euro's means MS is making a 100 euro's more loss on hardware that's allready loss-leading at almost 100 euro's.

Combine that with the promise to be profitable with the Xbox-project at 2007 towards shareholders (not being so will result in it being axed). No a planned pricedrop is not going to happen unless demand drops big time as stated above.

I don't know why anyone is treating price cuts as some big surprise. In the run up before the launch one of Microsoft's VP's, one Todd Holmdahl (Xbox product group), had this to say:

"We will wind up cost-reducing the product every year"

Now compare that with what was done on the original XBox:

11/15/2001 - $299.99
05/15/2002 - $199.99
05/14/2003 - $179.99
03/30/2004 - $149.99

If anything we're over-due for the first 360 price cut. The only thing that prevented them from doing so was the absurdly high PS3 price.

If the sales are going ok then there's no need to cut the price. I think a cut after christmas is more likely when there's a barren spell of software releases.
The PS3 pricing must have been a godsend for MS. They must all still be partying about it.
But Sony could still launch with a lower price if they wanted to. Nintendo did it with the GC in europe. Gave it a price cut before launch, which I thought was actually a pretty clever move because people seemed to buy an extra game with that saved £40. So Nintendo got their money regardless and the punters got another game.

From a pricing perspective, Microsoft is in the drivers’ seat. They could mark down the price of the Xbox 360 come Dec and really put the punch on the PS3 and subsequently affect the Wii also. I can't think of any other time in gaming history where one gaming system or company has that sort of advantage. Can anyone think of any other times this has happen?