Not everyone pays for a service on ps4/xb1, alot of them dont actually. Id be surrpised if even 1/3rd do, I think its less than that.
I also think the vast majoiry of people that buy games, dont just resell them after beating them.

So basically point 1) and 2) are moot.

Also the price of a streaming video game service is :
lag (if your net isnt fast, if someone in your house is downloading, if servers are stressed ect ect) (vs physical = it just works)
+ input delay(when you push button to action happends ingame)
+ tons of bandwitch used (which is pricy if you pay for usage)
+ compression quality (you wont get same picture quality as with physical hardware).

its "alot" of negatives to put up with, just to not have physical hardware able to do gameing.
Why? the hardware costs are put on the service perviders, but its still there. Maybe its slighly less than avg it out and makeing consumers pay for it, but these services will find other ways to recoupe that, so I doubt in the long run it ll be any cheaper for a consumer.

There are really no upsides to streaming video games as a service.
apart from the first time investment, but that ll be nickle and dimed back by the pervider over time.

I think its a sad future.

The point of what I said is that MS did give billions away in hopes of probable future returns in investments. AT no point am I saying the future cant be all digital, or even streaming, which I would hate. WHat Im saying is that no company will give a product for almost free and take a huge loss just to increase the intallbase. That is just crazy. Investors would not allow that.

I've not read here anyone that has suggested almost free, I certainly didn't I wrote subsidized but yes many companies will play the long game running at a small profit or loss in order to ensure they are the major player in the future where very large profits will be available. Companies like Tesla are in no way profitable today but as it establishes market share in the long term it will become profitable which investors and creditors have accepted.

Well, the thing that's got people's eyebrows raised is that they hired Phil Harrison and the code name itself refers to being a "beast of a [streaming] service". Which makes people think they could be shooting for something higher than a mere Play store device that comes with a controller. It's all speculation for now, but they have enough in the bank to cause a real disruption to the current market. Is a Netflix-type console the beginning of the end? Because I figure Google is going to sell it... hard.

That wonderful video makes me wanna share this gem: https://www.youtube.com/watch?v=xTqhyHuKVKA (I have no memory of how to embed videos over here).

...I don't think we will see any serious new entries into the market until one console maker retires, anyway. 

Bonzo, not all companies operates on the profit philosophy... like Amazon. All that is generated is reinvested on the company (that is if they are even operating at any profit margin on the products)... they work on growing the company value and investors making their money this way.

We aren't talking about that here though we are talking about making a loss even a small one to establish your product/service in the market place and ideally  end up in the no.1 position. Amazon certainly have a history of loss making to establish themselves. They haven't had profits to plough back into the business most of the time they have been servicing debt and investors playing the long game. As they have become larger and removed much competition they have moved towards profitability. Surely that is how they have kept investors on board.