LMAO. As MS sits #1, we can only construe that removing the HDD was dumb and shortsighted?
You are the one who is being shortsighted, in 2 or 3 years, when the core is $99 and Sony is struggling to cost reduce their console below $150, then talk to me about how dumb a decision it was.
FYI, I was one of the most upset members on this board when the dual-SKU was revealed, I thought along your lines that it was a stupid stupid move. But, when you look at the big picture, and huge price advantage MS's has going forward, it's hard to argue that it was a bad move strategically. They not have to worry about a BR player, built in Wifi, or built in HDD, and can concentrate solely on a gaming device at the lowest possible pricepoint. (Exactly what PS2 offered in it's time)
As for the Core sales tanking, why do I have to explain it to you? Any rationale adult can look at the SKU, look at the perihpheral pricing, and determine exactly why the sales are so poor. Overpriced MC, overpriced HDD, wired controller, no HD cables = horrible value.
MS has intentially gimped the Core at this point in time, probably because they make more profit on the premium, however with a few slight adjustments the Core could be presented as a good value and begin to sell. At $199, $150 and beyond, the Core will sell extremely well.
Only the semi-hardcore crowd spends $300-400 on a console, and those people aren't going to want the Core with all it's drawbacks. To take that, and extrapolate that the mainstream audience will have the same preference, is extremely poor analysis imo.