Has Microsoft lost the initiative in the battle with Sony?

Maybe this is just me, but somehow, despite all of the slipups and pitfalls Sony has been going through since its launch, it seems that Microsoft is still on the back foot, as it was with the original Xbox.

I remember buying the Xbox, only to find that a few weeks later Microsoft dropped the price, due to a cheeky price drop from Sony. In response to angry customers Microsoft offered two free games and an extra controller. Ever since that moment, it seemed the Xbox was always playing second fiddle to the PS2, even though the multiplatform games on the Xbox were usually better in terms of graphics and performance than Sonys.

Then came the Xbox 360, a full year ahead of the PS3, with High Definition and well over 100 games released before the PS3 arrived to market. With lots of hard work and determination, Microsoft, together with evangelist Peter Moore, who was quick to punish Sony's mistakes with cutting PR statements, had definitely won the initiative in this next generation of gaming. In recent months though, it seems that Microsoft has been struggling to compete, despite the high price, lack of games, and lots of negative press regarding Sony, and this despite still holding a lead in numbers of units and launching what might be the biggest game of the generation, Halo 3. Let's just look at recent developments which could be an indication that all is not well in the Xbox camp.

Microsoft first stated that customers do not need HDMI, and have now replaced the existing console with a HDMI equipped console, and have also released a third SKU with a larger hard drive responding to criticism that the 20GB was not large enough for customers who use their movie download service.

Microsoft stated that a hard drive is not required for this generation, and now we find that future MMO's will need the hard drive, and some games are now released with stickers stating 'optimised for HDD'

Some developers are reporting a lack of space on DVD as an issue only 2 years into the lifespan of the console and Microsoft are now rumoured to be developing a HD DVD equipped Xbox for 2008/2009

Microsoft have been the target of claims that they rushed the console to market with design flaws which have resulted in many returns and they were forced to increase the warranty to 3 years and also provide postage of consoles for free. The stigma of unreliability is still weighing heavily and the red rings of death (RROD) will be a nuisance throughout the consoles life

After what has been the biggest and most successful game release in history Microsoft have had to quickly drop the price of its consoles to match Sony's price cut, with no real evidence of progress having been made on reducing the costs of the console

In conclusion, despite the early lead Microsoft created and the superior games catalog (in terms of numbers at least) it really does seem as if Sony have weathered their storm of customer complaints about pricing and the lack of games titles, and answered critics who stated that HDMI and large capacity disks (Blu Ray) were not necessary, and with a massive effort to reduce the cost of the console, they are swiftly taking the initiative back from Microsoft ready for the holidays.

It remains to be seen whether the general public are ready to put their money on a high definition console this holiday, as with only around 30 million sold so far, this generation is still wide open.