Well. Not "increasing investments" is fine.
As long as we actually see the fruition of those investments, I hate games that are announced and we never see or we don't see until the next console generation. (I am looking at you Perfect Dark: Zero and The Last Guardian.)
Shuttling Fable and Scalebound before they saw the light of day was still costly investments with no gain for us gamers too.
Having smaller-budgeted experiences I am fine with, not every game needs to be a $100+ million dollar monster.
My most played game of all time is Minecraft... And that had an initial development budget that even I could afford.
In short, smarter investment is better than large wasteful investments.
Both Large+Smart investment of course preferred, but not always practical, especially when you are being dominated hard by the competition.
It will be interesting to see where Microsoft takes things, although I wouldn't hold my breath, Microsoft has *always* had an exclusivity problem dating all the way back to the Original Xbox, so I don't think that will magically change anytime soon.
Closing Lionhead, FASA Studios, Ensemble Studios, Digital Anvil, Press Play... Letting Bungie and Twisted Pixel run off into the sunset and loosing big second party like Bioware... Sure hasn't helped them.
Studios closing is a normal process, nothing lasts forever, but you need a plan to fill that content-void once those studio's have closed... And Microsoft hasn't been the most proactive on that front.