Well... The ball is now in Microsoft's court. I expect that the it's best If they announce the Xbox 720 within a month or so. The longer they yeild the spotlight to Sony, the more detrimental it could be. They have to be somewhere on par at least. This will be a very interesting holiday season with 2 next gen consoles on the market duking it out. Consumers just might get some great deals out of it this Christmas.
One thing is sure... at least we can lay to rest the notion that the WiiU is a next generation console.
Going forward, I expect Microsoft to announce the 720 away from Pax East, GDC and E3. According to Joystiq, Sony generated as much buzz as an E3 that usually contains Microsoft, Sony, EA and Ubisoft. Microsoft can do the same only if they announce away from everyone else like that. They should announce familiar IPs and sequels to get the loyal 360 players hyped and save the new IP and heavy hitters for E3.
This is going to be an exciting year for gamers!