Source TeamXbox (and IGN has it's own article which is very similar):
More power? Can these specs that we see mean nothing?
ign article: http://xbox360.ign.com/articles/615/615667p1.html
Of the recent Xbox 360 gameplay footage we’ve seen so far, the one major concern has been that of the sometime sluggish framerate. In a recent discussion with a number of Microsoft executives, we managed to learn that all current Xbox 360 games that were shown at last night’s E3 press briefing are still running on alpha development kits that are not a true representation of what we can expect when the console launches this holiday season. Estimations are that the current kits are running at only 25-40% of the maximum power that the Xbox 360 will possess. Beta kits are scheduled to hit developers within the next 2 months and final hardware should arrive in early July.
It’s no surprise that Microsoft lost money on nearly every Xbox sold due to the price point that the console came to market at, but Ballmer assured that they’ve since learned their lessons. Not only has Microsoft had the luxury of a three year planning window, but they’ve since strengthened retail relationships that were being formed when the Xbox launched. It may seem odd, but before the Xbox, Microsoft did not sell one product directly to retailers and so there was definitely a learning curve involved. Every aspect and feature of the Xbox 360 was thoroughly planned for to ensure profit, including the somewhat recent jump to 512 MB of memory.
It’s no surprise that Microsoft lost money on nearly every Xbox sold due to the price point that the console came to market at, but Ballmer assured that they’ve since learned their lessons. Not only has Microsoft had the luxury of a three year planning window, but they’ve since strengthened retail relationships that were being formed when the Xbox launched. It may seem odd, but before the Xbox, Microsoft did not sell one product directly to retailers and so there was definitely a learning curve involved. Every aspect and feature of the Xbox 360 was thoroughly planned for to ensure profit, including the somewhat recent jump to 512 MB of memory.
ign article: http://xbox360.ign.com/articles/615/615667p1.html