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Well, if you want real proof, watch their E3 conference. Mostly 3rd party games. And of the ones that were exclusive (most of them timed), I think most, if not all, were Indies. Sure, they'll keep pumping out Halo, Forza, and Gears til the stop selling, but they are going to be taking fewer and fewer chances on 1st party in general.

The thing is that MS doesn't see it as essential, so they are pumping less money into it to make it succeed. It's just too hard to go head to head with PlayStation when it's on its A game. I think if the X doesn't do very well, they may give it one more shot, possibly making Xbox more of a Windows box. But if that fails, I can guarantee they are done with HW.