Bold: The problem I have with that is then you can say nothings a failure. I'm sure sales expectations were dropped dramitically for the Wii U after they say how it's sales dropped off after launch, but it still was a failure due to an inability to meet initial expectations. That's a much more dire scenario of course, but the principle stands.

I'm honestly not sure what you mean by "Its something they did because they could". It's a value added feature, but it costs them money to implement and it's not really something that's going to drive software sales in any significant way. If you have 360 games you don't need to buy software, and they keep giving out 360 games in bundles or they get remastered for the Xbox One anyways. They did it to give themselves good press and to drive Xbox One sales. The PS2 emulation on PS4 is a bad comparison because you have to buy those games. Trust me, as a consumer I'd rather they just let me put in my PS2 games (not that I actually still play PS2 games) but Sony doesn't need to, so they didn't.

I'm not pretending 4K Blu Ray is anything. If 4K Blu Ray is $10 more to implement per system than normal Blu Ray then that's millions of dollars in lost revenue every year to support what is really a niche format. Once again, it's a value added feature. It makes them look good, and they can use it in advertising to try and sell more Xbox Ones, but they wouldn't have needed it if the Xbox One were selling better.

I'll reiterate.

Between lower per-unit revenue, lower software sales, less Gold subscribers, and weaker than expected sales. The Xbox One is going to have an roi that's likely a fraction of Microsofts origional expectations. That's a failure.

Wouldn't the fact that they have the fundings to go with Scorpio, whether next-gen or a revision of the Xbox One, a sign that Microsoft isn't all that unhappy with the Xbox division either?

This. Hell, we may have them overtracked here, given their performance outside a handful of countries.  Personally, I doubt MS is very happy with the XBO sales considering more than half are probably tied to the many fire sales they have had to have throughout the gen. That can't be good for profitability.

Any info to back that up? Other then general revenue numbers that include the late GBC years, all of GBA, and the first 2 DS years? Considering Nintendo was forced into price cuts very quickly, due to poor sales and cuts by Sony/MS, I highly doubt they were even given the chance to make much, if any profit, off of the GC HW.

The Scorpio has been in development for at least a couple of years, so it probably started before it became clear the XBO didn't have a shot at truly competing with the PS4, save for a couple of regions. But, MS has obviously cut spending on the Xbox division, a fact no sane person can deny. I'm guessing instead of funding 3rd party exclusives and exclusive marketing deals, Spencer has decided to put all his eggs in one basket, Scorpio. It's why they announced it so early and why they didn't stop talking about/promoting it, even at the expense of XBO sales.  If it fails, you can bet MS is going to greatly consider just pulling out. 

Being unhappy with where Xbox is at presently doesn't necessarily translate to pulling out of console gaming.  I'm sure they hope to turn things around with Scorpio, which has probably been part of the plan for a long time, perhaps even from the start.  Beyond that, Xbox is more important than just gaming, as Microsoft is probably looking toward a future where they can sell the service without a box.  In that sense, Xbox One itself is less important than market penetration and all the multi-media services bundled with Live.

Xbox is kind of like Microsoft Edge/Explorer.  They don't care all that much about the package, they care about it being a trojan horse for their services.

I'm sure they care a little about package but Microsoft has never really been the "cool" kid on the block ever.  Xbox is about the only "cool factor" that they have.  Everything else they put out is bland and boring usually.   Perhaps they might have a good product but then they suck at marketing.  I'm sure the Zune was cool if you had one but then that just fell off the map.  No one gives a shit about their phones and most gamers stick with Windows only because it is compatible with most games while Linux / Steam OS only support a few games on Steam still.  No one gives a shit about Windows Store.  They seem to just throw a bunch of shit at the wall and see what sticks which isn't much.  Basically if they lose Xbox then they lose any cool/hip factor that they have left.

Considering the steep, steep discounts it is always offering, it needs to sell a lot more than it already is. Unfortunately, with few exclusives, fewer games and worse performance than the competition, it is a system with very little appeal. So, i really don't know.

Not meeting expectations isn't an, "failure overall." It failed to meet expectations, agreed.

Adding any feature costs money, making games costs money. X1 BC is a feature that brings in revenue because X1 BC = More 360 software sales.

Again, 4K Bluray is not an expensive addition to the console. Adding up the cost between every X1S and Scorpio sold is irrelevant. Per device, its not an expensive feature. I agree its niche, but it objectively adds great value considering 4K players are expensive.

I reiterate, lowered expectations isn't, "failure overall."

20 million. Job a good 'un.