Microsoft has scoffed at the notion of re-releasing the Xbox 360, saying the console is a long-term product due to be bolstered by the release of Project Natal.

Microsoft’s senior director of Xbox product management is bullish on the future of the Xbox 360:“I think it’s important to say that the Xbox 360 is the console of the long future for us. There is no need to launch a new console, because we’re able to give this console new life either with software upgrades or hardware upgrades like Project Natal. 

The Xbox 360 was designed for a long life, and I don’t even know if we’re at the midpoint yet.”

Sony had previously employed similar rhetoric when trying to excuse flagging sales of the PS3 prior to its successful relaunch – Microsoft is evidently hoping for a similar fillip.
Microsoft abjectly refused to comment on the prospect of new chip features, a Blu-ray drive, or even a simple modernisation of the existing hardware, insisting all is well with the console:

“We love our prices right now. I don’t want to say that technology stops, but we believe we have a high quality console, and we stand by that quality with an unprecedented warranty, so we think we’re in a good place now heading into the Natal era.”

Previously Microsoft has asserted the Xbox 360 will remain a viable platform until 2015, though sadly it may be unlikely the same can be said of any of the individual consoles.
Microsoft is apparently planning to ensure this viability exclusively through Project Natal, apparently set to become either a groundbreaking next generation controller or else the means by which Microsoft can finally unleash a horde of mediocre party games onto the Xbox:



However, recent news that Microsoft has opted to slash the cost of Natal units by dumping a specialised processor in favour of having the Xbox itself do the work, which is naturally said to have no adverse performance impact, may yet prove an unwelcome reminder of the kind of quality the initial Xbox 360 models were notorious for.
Sony for its part plans its own markedly inferior Wii motion controller knock-off in the spring, which unsurprisingly also promises to offload its processing requirements onto the PS3 with no adverse performance impact.

-End of News-

Here's something personal to the phrase
"The Xbox 360 was designed for a long life, and I don’t even know if we’re at the midpoint yet.”