It's always good to have a nice install base. It's still nothing compared to the PS2. But with the price the way it is this is no surprise. I'm currently trying to decide if I should get a second 360 or a PS3.

I want to want a PS3 but other than Blu-Ray what does it have? I can count the number of games I want from it on one hand. I can pretty much count on Xboxes to break but now I'll have a backup. This install to hard drive feature makes the Xbox completely silent, it never bothered me before but now that I have it, I love it. I wonder if it prolongs the lifespan of the the 360 before I have to turn it in for repairs. Which is down to 1.5 to 2 weeks. (Recent experience from me and my friends)

With a second Xbox I wouldn't have to lug it up and down the stairs when I lose a fight for the bigger tv.

As for price, I'm looking at the $299.99, 60 GB 360 or the 399.99 PS3. I could plug in the Ethernet cord to my laptop and use it as wifi for the 360 so that's not an extra cost. I already have Xbox Live Gold. I would be missing the Blu-Ray though. Why can't sony just cut the freaking cost of the PS3? I guess they're determined to make a profit.

I'm not sure what I'll do. It's possible that half these console sales are from Xbox addicts like me, getting their second 360. Software sales will tell us soon enough.

No need to pull the plug. The reason they had to get out of the original was because they needed to go with hardware which they didn't own the rights for so they couldn't cost reduce to realize profit. It was worth it to get into the market and establish a base but did not allow for future cost reductions.
With the 360, MS owns the rights to all the hardware so they can get competitive bids and redesign the fab of those parts to reduce costs and maintain profit even after dropping prices for consumers. I expect they'll put out their next console around 2011, but keep the 360 around until sales dry up for it.