Well, there are about a hundred Xbox 360 titles planned next year and Microsoft is making it their entry-level option for gamers. I think they're doing the right thing here and certainly the hardware has a lot of life left in it. Sony's doing the same for the PS3, so this isn't really anything new for the market, but it is different for Microsoft - their first long-term support phase for a console.
It also means that we shouldn't expect massive price drops on the previous generation, or the next one either for at least a year. The Xbox 360 250GB will remain at $250 with the One at $500 and the 4GB 360 at $199. The PS3 will start of at $199 as well and the PS4 will remain at $399 for a while. Its quite an odd market this year.