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Paying for third party exclusives really doent help them in the longer run. Microsoft is better off building new studios and developing new IPs that they can own.
The XBX really isn't going to set the industry in fire sales wise and I think MS knows that. At first it will be for those that want the best performance from consoles, hardcore Xbox fans, and tech enthusiasts.
They probably expect it to sell better down the line as a cheaper entry level console that can play ninth gen games with their no generations approach.