MSFT has far bigger plans for XBox than a gaming platform. It will eventually replace the PC in the home. It will be a platform from which MSFT apps can be downloaded and used on a per/time or subscription basis. MSFT just wants the platform in every home... even if they have to give it away! Get them used to the XBox brand and they will keep coming back to buy upgrades as MSFT transforms this platform into the home PC replacement.