Based on all the rumors it kind of sounds like Microsoft’s plan for the Xbox is to make it something like their Surface lineup on PC: basically exists to promote MS software and also gives MS a say in hardware standards, but absolutely not meant to compete 1:1 with other OEMs and ultimately in service of protecting and promoting windows.
I have a feeling the next gen Xbox is going to be something more akin to a quasi-PC, kind of like the steam deck. Less a platform, more just one device among many.
If this really does come to pass, I think they will be my final exit from console gaming. I genuinely do not like PlayStations first party studios, nor do I like their controllers, and Nintendo doesn’t really make the types of games I want to play anymore. To the extent that I am going to continue to play video games I will be full time PC I think, there will just be nothing left on the console side for me