I know it\'s late now, but microsoft originally said they would price it competitively with the PS2, however in recent interviews, spokespeople have simply responded to that question with "does the ps2 come with a HDD or modem?"... which tells me they are now bracing for a more expensive product.
Other problem with Xbox? It\'s coming out a little late.. Sony already got my money, and unless (as I said before), microsoft has games that interest me as much as FFX, FFXI, MGS2, and GT3 I won\'t be buying one, especially since I\'ll be getting 3 of those games around release time.
NEWHO, we\'ll just have to wait and see what kind of loss microsoft is willing to take on the box. We\'ll also have to wait and see if the (you stated) $375 manufacturing price tag stays there.