MS/Sony, it really doesn't matter to me. I'm not sure I'm investing in the next generation. I already have a PC more powerful than either of these two future devices. I'm not interested in the DRM Sony is proposing (allowing publishers to block used games and monitoring loading times for piracy). Sony's controller is inferior to MS controller and Kinect is better than Move (though I don't see any reason to own Kinect/Move). MS is rumored to require a constant on-line connection to combat used games/piracy...bah, don't need or want that. I'm tired of companies treating me like a criminal.
I'll buy a new Xbox if they: 1) Provide backwards compatibility, 2) Don't required a constant internet connections, 3) Don't block used games. Otherwise why should I upgrade to the next generation? MS almost no first party exclusives (GoW and Halo don't do it for me). Sony has alot more exclusives, so if I were to buy a console and hassle with restrictive DRM, I might as well go with Sony.
I don't understand backwards compatibility and why it's not being included. I can play PC games from the dawn of time on Windows. Yeah, maybe it requires some additional hardware to emulate it properly...but you can sell differently tiered units. Is it worth it to pay $100, $150 more to have backwards compatibility? I think so, and if you didn't, save your money and get the cheaper system. If/when the sales drop to unacceptable levels for the backwards compatible units, discontinue them. (Note: Since the current generation consoles sell for $100-$200, it would be an epic failure for MS/Sony to charge more for backwards compatibility).