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So, Microsoft's Zephyr system turns out to be the Microsoft Xbox 360 Elite or some similar named system. And seems to be slightly different than originally advertised as it won't use new manufacturer processing to use smaller die parts, and won't be including an HD-DVD drive as Microsoft has decided to keep that as an add-on (which may not be that bad considering that things still aren't decided between HD-DVD and Blu-Ray).
The other advantage to keeping the HD-DVD as an add-on is that Microsoft can keep the prices of those add-on drives up in the $200 range and keep them profitable, or at least keep the losses that they suffer on the sales of those items minimized compared to building the drives into the Xbox 360 console and jacking up their costs for the equipment that they will be providing to customers all in one package.
I don't blame them for trying to minimize costs and maximize profits, and in reality the pricing on the Elite Xbox 360 package isn't bad. You get an HDMI port built into the box, HDMI cables, the larger harddrive (120GB instead of the original 20GB model) and you get it all in a slick black package (instead of the original white case, the elite uses a black case and comes with black colored accessories instead of the white controllers that the original Xbox 360 shipped with). Reportedly you also get a data transfer cable to use with the Elite 360's harddrive that will let you somehow transfer data from the original Xbox 360 harddrives over to the new harddrives (Microsoft is assuming that they'll sell a fair number of the new Elite boxes to fanboyz that already own the original 360 and will likely be selling used or giving to friends, re-using for others in the house, etc.)
No, I don't fault Microsoft for trying to make a profit on the Elite 360, or in trying to keep costs down a bit on that box. They reportedly lose money on every console they sell (I hope they sell a lot more of them <-big wide evil grin->) so I can easily see why they want to keep the box from costing even more by including a drive that supports a format that their games don't require and which may wind up orphanned over the long run anyway.
What I do fault Microsoft for is the fairly high pricing on the standalone, add-on version of the 120GB drive. $179 (reportedly) for that drive is a jacked-up joke. Heck, $99 for the original 20GB drive is a joke. 20GB drives are miniscule drives any more. They were pathetically small when Microsoft introduced the box and they were slammed then for using drives that were too small, and for charging too much for too little when sold separately. They are still slammed now for the same thing, and I'm slamming them here for charging way too much for way too little even as they introduce these 120GB replacement drives.
120GB is still woefully small storage wise. I can fairly quickly search at NewEgg.com and find this Seagate Barracuda OEM 320GB SATA drive for approximately $100. Given Microsoft's clout with manufacturer's, I'd expect that they'd get drives like that in bulk for approximately $80 per, put them into their own special Xbox 360 accessory case, put that into a package, and still be able to sell them for $150 and make a profit on each.
Ah, profit. { Insert Ferengi style greedy moaning over the word profit. }
Yup, Microsoft is gonna profit on those 120GB drives. At $180 per they are still gonna sell to idiots like me that just can't help themselves and will buy the drives because they want the storage space for keeping tons of demos, TV shows purchased and downloaded via the Xbox Live marketplace, game saves, themes, gamer pics, and anything else you can think of. We're gonna lap it up even as we complain that Microsoft is ripping us off.
They will be ripping us off, but we're gonna pay it. We'll pay it and complain, and they won't care. They will be patting themselves on the back because they'll have gotten more money from us for the hardware, and they know that once we get the bigger hardware we'll be even more likely to buy more content to fill it with.
Darn you Microsoft!
