Olympus abdicating entry level ILS market?

It's been going on for some time already, the silent war between the dominent DSLR makers and the small MILC makers. While it is true that MILCs can be made cheaper, that relies on everything else being the same, especially on volume of sales or economy of scale. Olympus, and also Panasonic, do not have enough volume and therefore find it tough to recover costs of development.  They have to maintain a certain volume even knowing it means over-production and then they have had to resort to fire sales in a shrinking market as a result. So, selling old mid-level models cheap as "entry level" models is killing 2 birds with 1 stone, to clear stock and to reduce development cost and more of the same overstock problem.

Canikon also suffer in a shrinking market but they can with their lower cost of goods sold (due to a larger volume) afford to undercut Olympus and Panasonic with abnormally low prices for their entry level cameras, making sure that the smaller fish to die first if conditions should continue like this.  I believe they are doing exactly this, cutting their own profit to make Olympus and Panasonic unprofitable and hence less able to compete with frequent new models all the time like previous years.  Market share first. Those entry level DSLR prices are unbelievable and are clearly a strategic move.   It's war.

It is important to have entry level models to let the user base grow and let them become enthusiasts later. However the companies have to first survive and at this time, it seems they are trying to drag their feet and hope to wait until the market bottoms out before getting entry level models out.