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The_Liquid_Laser said:

Short answer is it definitely isn't bad.  It might not be good either, but it definitely isn't bad.

Longer answer is that what Microsft really cares about is the PC platform.  Not as a gaming platform, but as an everything platform.  Anything that gets people using the PC more is what they want (gaming or not).  In fact, Microsoft is the PC platform.  They own it.  What brand makes something a PC?  HP or Dell or Acer or what?  It's Microsoft.  If it's running a Microsoft OS, then it's a PC.  Microsoft owns the PC platform.  

So on the gaming side their focus right now is on Gamepass and xCloud.  To Microsoft, their main competitor isn't Sony anymore.  It's Google and Stadia.  Why?  Because Google wants people on Android devices as much as possible and Microsoft wants people on the PC as much as possible.  This xCloud vs Stadia battle is just one part of the war over the whole internet, PC vs Andriod. 

So if Microsoft puts a game on the Switch, what do they care?  They don't really even care if Nintendo succeeds or not.  It's just a way to market their games.  "Hey if you like this come check out all of our stuff on Gamepass."  They don't care if Nintendo benefits, because they are competing with Google.  So, this definitely isn't a bad move.

Only reason I say this move might not be a good move either is that I doubt either xCloud/Gamepass or Stadia will get much traction from established gamers.  Anyone who games on Switch or PS4/PS5 is an established gamer.  I doubt many established gamers will mover over to cloud gaming.  If cloud gaming takes off it will be in areas where there isn't much of a console presence like India or Russia or all of the other countries without much of a console market.

So, to sum up what I already said, it won't hurt them, but it probably won't help them much either.

I believe you are wrong that established gamers will not use the cloud features of gamepass.  I was using it on my android phone using my xbox controller and I must say it worked very well. Actually it worked so well, that I can see myself taking my controller with me on trips with the family, picnics you name it.  Also being able to caste my screen to TVs when I travel gives even more incentive to use the cloud features.  It will be interesting to see how much reach gamepass will have for MS but I do agree with the first half of your post.