I'm not at all surprised at the relatively inexpensive price of the X-Box with HD DVD. We already know MS sells this game console at a loss in hoping to surpass Sony. Sounds like they are kicking in a few more subsidy $$ to make the X-Box a compelling buy.

M$'s tactics shouldn't surprise anyone. They expect to be in the red on X-Box, Zune, MSN, and pretty much everything else while the OS client and server division, along with their Office division keeps all of MS in the black. Ah to have unlimited hordes of $$$$....

Cheers,
Bondster!!

it's their last ditch effort to make some sales worth spitting at in Japan.
Sales has been utterly dismal here.
Everyone is waiting for the PS3 here.
also, even though the original PS2 came with a built in DVD player, DVD movies and players only really became mass market in Japan over the last 2 years!
2 years ago, set top DVD players cost over 200USD here. now you can get the 40USD chinese off brand models just like in the US.
But 2 years ago, most video rental shops had pathetic DVD selections here too!
i assure you all, the Japanese consumers are not scrambling for Hi-Definition video. (they call it Hi-Vision here anyway, but it's still highly non-compelling.)
Who really cares about a few more lines of picture, the difference is not much for the price at this point (the TV price)

Add to that...there is no true HDMI on the xBox either (YET?). The xbox360 does not have a digital video board so any HDMi cable will have to be converted from Component or VGA. Which, I would assume, would apply to HD-DVD's being played through the system as well.

Wow, that's a great price point. Makes me somewhat more satisfied with my Xbox 360 purchase.

What's amazing is Microsoft has made it so game developers can't develop games on HD DVD nor can they develop games that require a hard drive. To me, this means the games are more limited on the Xbox 360 than the PS3.

Am I wrong?