I was reading an article on Joystiq about eminent price cuts on the PS3, which got me to thinking about the Xbox 360. Thus far, Sony has bet on the PlayStation brand and not what the PS3 is actually capable of. Everyone knows that Sony is going to have to eat more money on the PS3 and sell it for less before it gains traction.
But at the same time, there is a stigma around cutting prices on any product, let alone consoles. It usually angers the early adopters, and devalues the existing consoles on the market. But the PS3 will have to cut the price to survive; it has no choice but to face these consequences. But the consoles that follow suit to stay competitive don't usually suffer the same stigma.
So it's no wonder that the Xbox 360 hasn't seen a price cut yet. Why cut the price first and be the "bad guy" to early adopters, when they can wait until after the overpriced PS3 corrects course, and then use the reasoning "we had to stay competitive" as justification? If I were in charge, that's what I would do.