It is the future. Eventually local hardware will be minimal to non-existant where everything is done with cloud computing. We won't get there anytime soon, though, due to limitations in data transfer technology over vast distances.
But the things it can't do today, it might be able to do in 10 years from now and that's what MS is banking on. They want you to never have to buy another console after Xbox One because the cloud will enhance games enough by that point to not need an increase in local hardware.
I think their 40x stronger with the cloud stuff is mainly their goal for this console cycle. Although obviously that means all new games would have to be always online at some point.







