That is a LOT of money that would never have impacted the industry. Xbox funded quite a few larger games early on, then later funded a lot of indie games which prompted the others to follow suit. There never would have been the need for so many exclusives, timed exclusives, or marketing deals, all of which helped publishers and developers with cash flow.
That probably means there would have been less successful studios and less games produced overall.
As for GFWL, it was an utter and complete abomination. I still consider it the worst experience I've ever had in gaming. It deserved to fail. I like to think that someone would have taken Steam's place eventually, simply because GFWL was so awful. Also, never forget that Microsoft tried to force PC gamers to pay a subscription fee. I have zero doubt that the PC gaming situation would be far worse now if Microsoft had emerged on top.
