@JJ2 I see what you are saying (and don't 100% disagree) but I also see what Phil Spencer is saying. I think his point is that he sees gaming is on the verge of being very different and changing dramatically and I think a lot of people interested in the industry are still fixated on the past model of success. Traditionally, hardware is king and the gateway to people buying games so you try to tie people to hardware.

From that perspective, MS has 'lost' the console war this generation. They have sold less consoles, made less games, sold less games. Sony has sold more consoles, made better games, and won the gen. Nintendo has also done pretty well post Wii U with the Switch. If a game sells well, lots of money is generated for the publisher and platform holder.

However, this type of revenue flow is very very risky. A game bombs, you make less money. If you delay a game, your profit projections drop. The real money made this generation is in digital transactions and subscription services.

Microsofts strategy, across industries, has been very specific. Device agnostic, service and subscription heavy. Office 365, Azure services, Dynamics, Dev Ops, PowerBI are all subscription services that you can run on any machine. They have invested heavily into being cloud providers in the same way that Google and Amazon have. It is clear, to me, that Microsoft want the XBOX brand to not be about a machine under your telly but a service you pay for monthly and leverage their cloud infrastucture to play.

In that sense, Microsoft will be going up against the other big cloud players, Amazon and Google. Sony does not have that sort of infrastructure in place and it would be very costly for them to do so. Now I'd agree with anyone that says cloud services, cloud gaming etc. isn't there yet - the Stadia has poor offerings and won't work globally because of the signal requirements. A bad launch too. I think the PS5 'generation' will still heavily feature physical sales, exclusives and all that.

BUT, and this is my point, we can see the massive changes this generation already. Digital subscription services have driven the profits this gen. Xbox, Google, Apple, EA, Sony have all got a subscription gaming service. MS, EA and Sony are looking to make those services multiplatform (if they haven't already). They are looking at the Netflix model and everyone wants a piece of that pie and the battleground for that future, is going to be the cloud. All these digital services and online offerings will want to utilise cloud services and again, MS, Google and Amazon are those big players that offer that. The memorandom of understanding between MS and Sony is a clear move that Sony want to utilise MS's space and that is a win win for them both.

Now, I don't know if this future will come to pass but you can see why platform holders want it to. Xbox are investing heavily into the future and I think the war over who makes the best exclusives and flogs the most machines will be less and less relevant compared to who can drive and win the most subcribers and service users.