Hardware
The Playstation 3 has the decided advantage when it comes to hardware. The CPU, memory, and graphical prowess is roughly a wash on both consoles as they are capable of roughly the same computational and graphical rendering abilities. Still, it's evident that there are some issues with the PS3 given the graphical slowdowns and framerate issues present only in the PS3 versions of multiplatform games. All PS3 models offer a bluray optical drive, HDMI, gigabit Ethernet, and USB 2.0. In most models it also includes built-in Wifi and Bluetooth capability as well. While the hard drives are roughly the same in size to many Xbox 360 models, the PS3 makes it much easier to expand as it doesn't require proprietary hard drive preloaded with software as the Xbox 360 does. The Xbox 360, while offering HDMI in its current models, only has a standard dual layer DVD optical drive, 10/100 Ethernet capability, and Wifi only though a $100 adapter.
The elephant in the room hardware wise is the reliability aspect. This is where the Xbox 360 really falls apart. The Xbox 360 had a hardware defect where a heat source within the case causes some internal connections to become disrupted. This would cause a famous red ring to appear on the console indicating a specific hardware failure, hence the "Red Ring of Death" moniker. This hardware issue was so bad that Microsoft extended their warranty for just this issue for a full 3 years after purchase. When it happened to me a year and a half ago they paid in full for me to ship my Xbox 360 back to them. While it was a nice gesture since it didn't cost me any money except to get to the UPS Store, not having my Xbox 360 for 6 weeks was really disheartening and it caused me to appreciate my Nintendo DS a little more. Since my warranty for this issue runs out this coming December, I am not filled with confidence that my Xbox 360 will hold up throughout the rest of the machine’s supported lifespan. What’s more, should I sell my Xbox 360 the used market has really depreciated because of this very hardware issue and I wouldn't get as much money for it as a result. Aside from the Red Ring of Death issue, both consoles endured issues from drive failures to the console scratching game discs, however these issues were minor even for a typical console release.
Features
When it comes to console features, the PS3 has a lot more flexibility than the Xbox 360. For instance, I can burn a DVD filled with AVIs or MOV files taken on a digital camera and my PS3 will play them just fine. It supports most major playback modes for video, audio, and images. The Xbox 360 is much more restrictive in that you cannot use your massive hard drive as a media server because it's very hard to place files on your drive. However as a consolation, you can configure your PC as a media server and stream music and videos from there through your Xbox 360 onto your TV. It's kind of a hassle but at least it's a workaround.
Both consoles have some sort of goal-based recognition for playing their games. The PS3 has trophies which are awarded whenever you accomplish certain tasks in games. It doesn't work well for all games, but it's a nice thing to have. The Xbox 360 has achievements which is the same thing only there's a point value attached to each achievement which contributes to your overall gamerscore. The fact that this gamerscore is always displayed prominently on your gamercard makes this a much more public display of gaming prowess than I care for. I often am ashamed of my gamerscore and like to record my achievements or lack thereof in a second less public account. I'm not too fond of this as it seems like the gaming equivalent of every guy walking down the street with his pants down constantly comparing each other’s wangs.
Both systems have connectivity to commercial streaming media services. The Xbox 360 offers streaming movie service to Xbox Live Gold members and Netflix members via the Netflix service. It's convenient if you have accounts to both Netflix and Xbox Live Gold, but otherwise restrictive and expensive if you don't use one of those two services. The PS3 connects to a streaming music service called VidZone which offers streaming music, music videos, and ringtones. But let's face it, if it isn't iTunes, most people won't care and it's probably not worth subscribing to.
The PS3 offers some additional features not on the Xbox 360 including a decent web browser, a cluster-based program called folding@home that lets your PS3 analyze medical data when you're not using your PS3, and connectivity to the PSP. Most of these features are nice, but they definitely shouldn’t factor into many people’s console-buying decisions. Frankly if you have $400-$500 to spend on entertainment and need a web browser, you're probably going to spend it on a PC.
Games
It's my firm belief that the library on the Xbox 360 is superior to that of the PS3. There are only three exclusive titles that standout among their peers on the PS3: Metal Gear Solid 4, LittleBigPlanet, and MLB 09 The Show. This is compared to Gears of War 1 and 2, Halo 3, Saints Row 2, Mass Effect, and Fable II. In addition to the edge in exclusives, most multiplatform games simply perform better on the Xbox 360. It's almost as if most developers write their code for the Xbox 360 then port it to the PS3. The multiplatform sports games especially bad regarding slowdown or lower frame rates on the PS3. What's more is that downloadable content is much more plentiful on the Xbox 360 versions of multiplatform games and many Xbox 360 games receive patches where their PS3 counterparts do not.
Regarding genres, it's really no contest in most areas. Unless you're a baseball fan, a fan of Metal Gear, you really won't find better games on the PS3. While the PS3 puts forth strong first person shooters like Resistance Fall of Man 1 and 2, and Killzone 2; the Gears of War games as well as Halo 3 are more critically acclaimed and sold more copies in the marketplace. Sports games are vastly superior on the Xbox 360 due to framerate issues on the PS3 as well as downloadable content. Peggle Deluxe trumps any puzzle game on the PS3, and the Xbox 360 just has many more quality racing games than the PS3. Even RPGs are stronger on the Xbox 360 with Mass Effect, Fable II, Lost Odyssey, and Blue Dragon. The only exclusive quality RPG on the PS3 is Valkyria Chronicles. This is surprising given the Playstation's stranglehold on this genre the last two console generations.
The downloadable games really are a wash. Both the Xbox Live Arcade and PSN games boast some great titles like Geometry Wars, Calling All Cars, Super Street Fighter II HD Remix, Flower, and Braid. There are some surprisingly quality games on both systems available for download. You really can’t go wrong in this area no matter which console you choose.
As for backwards compatible games, the PS3 clearly has an advantage given its vast library of PS2 and PS1 games. The Xbox 360 does have backwards compatibility for many of its Xbox titles, but not all and it’s much lower percentage-wise and even more so numerically than the PS3. However, all you need to play those Xbox games on your Xbox 360 is a hard drive, which is practically required for its owners anyway. While the older PS3 models features a 90% compatibility rate with PS1 and PS2 games, and later models an 85% compatibility rate, all the PS3 models currently in production are not backwards compatible with any PS2 games. Fortunately all PS3s even the ones in production does support backwards compatibility with PS1 games. While those games are a little tougher to find since Gamestop has been clearing out their inventory, there are plenty of quality titles, especially RPGs which can make a PS3 purchase more worthwhile. However the lack of PS2 backwards compatibility can be a problem for people looking to pick up a new PS3 if they have a large PS2 library. I feel lucky to have an old 20GB PS3 which can play most PS2 games, but not everyone might be able to find a model like that.
Accessories
The accessories for the most part are a wash between the two systems. Both the PS3 and Xbox 360 have their own webcam, wireless headsets, DVD remotes, and texting keypads. The most worthwhile 1st party accessory that Xbox 360 has is a wireless racing wheel. Other accessories like memory cards, joysticks, rechargeable battery packs, and the HD DVD player are either too specialized or just serve to remind you that the PS3 has better standard features (built in rechargeable battery for the controller, and Bluray player, and hard drive).
I prefer the symmetrical feel of the PS3 controllers over the Xbox 360 one. The analog stick is a little lower on the PS3 version and I like the buttons on the PS3 a little better. The sixaxis controller features a gyroscope that senses controller tilt. It's not as sensitive as the Wii remote, but it's good for certain features. There are quite a few games that take advantage of this sensor, but for most of them it's simply a novelty. The original sixaxis controller didn't have a rumble feature. Instead you have to pick up a DualShock 3 controller, which is only compatible for just 3 dozen recent titles, most of which already have rumble support on their Xbox 360 counterparts.
Even though the Xbox 360 has a nicer set of accessories, the motion sensor in the sixaxis makes the PS3 controller much more versatile. It has all the buttons and analog sticks needed for a modern console game, but motion control to add a few interesting gameplay mechanics as well.
Online Service
In the modern console age, the focus is now on interactivity. Back in the Nintendo days, a good multiplayer game was having a friend or two play Contra on the same TV. Now it's all about playing with friends and strangers over the Internet. Beyond the gaming aspect, both PSN and Xbox Live bring lots of content to the console. You can download full copies of games to your hard drive, you can download games only available via PSN or Xbox Live, and there are downloadable movies, TV shows, and game demos too.
When I think of the difference between online services the phrase "you get what you pay for" comes to mind. I'm all for saving a buck, but when it comes to playing games online sometimes you're best off investing a little more money. An Xbox Live Gold account costs anywhere between $2.30 to $8 per month but enables you to play multiplayer games, video chat, and to stream movies via Netflix. I can understand the multiplayer gaming and video chat, but to limit the Netflix to Gold members seems rather restrictive as Silver members can get just about all the downloadable content the Gold members can with a few minor exceptions. Still the price isn't too bad. I got a couple 13 month subscription cards for $30 each around January of this year.
PSN on the other hand offers roughly the same sort of features for free. One of the differences is instead of a standard set of servers maintained by Microsoft, each publisher sets up and maintains their own. In addition to that, there isn't as much downloadable content. This could increase given Sony's influence in the movie and TV industry. It just surprises me that Xbox Live still out does them in content. The one interesting feature unique to PSN is Playstation Home. This avatar based interface is almost like Second Life on your Playstation 3. I found it interesting and filled with potential. However it's simply that at the moment, potential. The Playstation Home community isn't as dedicated to this virtual world as in other worlds like Second Life or even World of Warcraft. I think the limited install base and general apathy really hinders this feature.
Overall
The Xbox 360 and PS3 were never meant to co-exist in a single home. They're both very expensive, and they both try to fill similar roles. Still, different groups will get more out of one versus the other. But despite their specialized appeal, they are in direct competition with each other more than any other two consoles of this generation.
When it comes to a media server, the PS3 is top dog but not by much. Having a Bluray player built into the system is a huge plus for movie fans. It has a large hard drive, and the flexibility to deliver a lot of content. PSN delivers almost as much multimedia content as Xbox Live Marketplace where its biggest omission is Netflix connectivity. One of the only reasons I keep my PS3 around is so I can watch movies on it. I burn videos of the kids to DVD and it can display most image and video formats. If you watch movies more via Netflix, then perhaps the Xbox 360 is a better console.
If you're a gaming enthusiast first and foremost, then the Xbox 360 is definitely your console of choice. It has a much wider variety of current generation games; in addition the multiplatform games for the most part perform better on the Xbox 360. Most games receive patch and downloadable content via Xbox Live whereas it's often neglected on the PS3. As for console-exclusive games, the Xbox 360 has a formidable array of games. You will be missing out on a few good titles on the PS3 but most will not even notice.
For the budget conscience gamer, it's a tough call as to where to go. The Xbox 360 costs less up front, but runs the greater risk of hardware issues especially when buying a used console. I bought my PS3 used with high confidence; I bought my Xbox 360 new because of the hardware issues. If you want to play online, the Xbox 360 owners will likely end up spending another $100 before they're finished with the console. Accessories and games are mostly a wash. The used game market is a little more stable on the Xbox 360 front because of its more established base. But that also means you won't find the rock-bottom prices you'll see from PS3 games either. Then again, part of the reason for the rock bottom pricing is from merchants who need to get rid of an inferior PS3 version of a multiplatform game. I don't imagine the budget gamer to be big into Bluray movies, since they're significantly pricier. However they definitely would like the wider selection of cheap PS2 games for the consoles that offer backwards compatibility. For now, I think there's still too little incentive to take the plunge into this generation yet and you're best off sticking with your PS2.
Besides the above considerations, there's one more factor that seems to ring true to me. The number of people who own Xbox 360s is much higher than the PS3. This issue factors in a multitude of different ways from your ability to find an opponent for an online game, to the amount of support a publisher will offer, to your ability to find a buyer for your used games. While sometimes it's not prudent to follow a crowd, in this case you might find that in doing so will provide a more positive gaming experience.
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