We won’t know for sure until the Microsoft event next week. But if Xbox exclusivity is no more, and Game Pass is not sustainable long-term, it could mean that Microsoft is getting out of the console game entirely, or that they’ll rebrand themselves as a third-party developer, or both. That’s what Sega did after the Dreamcast failed in 2001. If Microsoft has determined they are too behind on hardware sales to catch Sony in the next console generation, they might not have a choice.
None of this is good for consumers. PlayStation fans might be crowing over this, but they shouldn’t be—ultimately, competition is healthy. When Sony and Microsoft compete for consumers’ dollars and attention, that means they get better choices. If it’s only Sony in competition with itself, it’ll be easier for Sony to get complacent, increase prices, or engage in predatory practices. Fans will have to see what Microsoft says next week—and then wait to see how Sony reacts.
And as for Nintendo? They’ve managed to stay out of the console war entirely, by creating their niche that emphasizes gameplay and family accessibility over cutting-edge visuals and sound. Nintendo realized, around 2004, that a graphics arms race would end up with only one winner, so they went in a different direction and avoided the confrontation. Twenty years later, we see how prescient that decision was.