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MS has seen that they cannot beat Sony in a head to head console competition, so it makes sense to go in another direction. Besides, some kind of subscription/streaming is undoubtedly going to be the future of gaming anyways. Just not sure if it's the right time yet, although Sony should be looking ahead as well. Console gaming seems to be doing fine for now, at least for another gen.
Gamepass is a sweet deal for the existing MS userbase, but I'm not sure if it has much wider appeal. The games have to be there, the exclusives need to be much better. I guess if you lean more to the casual side and are not too picky about what you like to play, then it's great value because you get a lot of stuff for a very reasonable price. But there are also people like me, who are very particular about the games they want to play and for us it's not a workable model to pay something every month to get whatever games.