This is the kind of stuff that makes me really question other decisions at MS.
There are a TON of potential revenue streams from an advanced console. Things like this interactive advertising deal, using kinect HD/2.0 for advanced consumer behavior research, kinect 2.0/HD web/local search, etc.
All of which require two things to be successful:
1) Enough compute power to run behind the scenes and not deteriorate the primary purpose of the console (games)
2) Enough units in the wild to harness the xbl3.0 revenue potential
As is, xb720 live3.0 may have all the bells and whistles in the world for nextgen advertising (and all the $ that entails), but in the end, if that box is competing with another box which has all the same potential, AND THEN SOME, while at the same time charging less or equal for their online offering, why would a consumer PAY to go here (xboxlive 3.0) instead of the competition?
So much potential, all pissed down the drain to save a few bucks on the BOM.
Fin idiots.
Before some pipe up about how those BOM dollars add up, take a look and see what Google rakes in per quarter on nothing but ad revenue...
Higher spec (even spec parity) would allow for live 3.0 to grow into a massive revenue stream for MS (much greater than the $1b/yr they make now). It all starts with the core gamer.
MS is about to learn this lesson - the hard way.
/offtopic rant