Rumor: 20GB 360 dropping to $299 July 6

Speaking as someone who is on his 5th Xbox 360, how can the hardware get any crappier?

"It just does not seem like M$ to diminish their profits."

What are you talking about? When you have a billion dollar money making OS behind you you can cut profits. It's just like Sony when you have a company as large as it is you can afford the lose in cash because other places make up for it in the company. Oh and just want to remind you of this, M$

In the gaming arena (and others as well), Microsoft is willing to take losses if they are strategic in helping them control a market. It was only recently that the 360 hardware started turning a profit, albeit a small one.

I don't think Sony and MS are willynilly in taking losses, but they'll do it.

I think MS really believed their line about the first console getting to 10 million would dominate. I think that they assumed that and planned accordingly. Now, they seem to be grasping all sorts of things since that assumption has been proven false--making their own wiimote, creating Mii-like avatars, creating their own version of Home, and dropping prices. True, several of these are rumors. But I think this drop reveals a high level of concern because they are now finally turning a profit on the hardware. At least before this price drop.

It's not "crappier." Hardware gets cheaper as years go by.

Hardware does get cheaper, but it can also get crappier. There is a marked difference.