I would say that what Microsoft is doing with the rumours of the extra functionality is to help make the extra 'features' such as the HDD and Kinect pay for themselves. Whilst you may not be able to justify having both Kinect and a HDD which probably means about $100-120 extra on the B.O.M and $200 retail for a machine which only plays console games. These features whilst they do add value from the perspective of just playing console games, if they can put them to use with multimedia they can spread the cost to that area as well.
Sony may have struggled to sell a $499 PS3 + accessories and games in the U.S.A. however Microsoft ought to have better luck selling a $299 Xbox 3 + $15 month subscription which can do work as a TV box as well as a games machine.
Sony may have struggled to sell a $499 PS3 + accessories and games in the U.S.A. however Microsoft ought to have better luck selling a $299 Xbox 3 + $15 month subscription which can do work as a TV box as well as a games machine.