Microsoft will not leave gaming because even before the Xbox they were in the gaming industry,

Even in 4 chan, the people who hate the Xbox defend Windows as an OS against the "Macfags".

I think the Xbox was a mistake from the get go, Microsoft should have instead focused on Windows as a gaming platform. In a way, Steam has done more for Microsoft than the Xbox .

If Microsoft is smart, they will implant Xbox on PCs and maybe creating a certain Microsoft PC with full Xbox Console on it! PC and Console at the same time! CooL

Agreed. But I can see MS pulling the trigger at the end of this gen. Consoles is no longer the battleground for home domination, so there really is no business case to stay in that game for MS. They need to focus on tablets, mobile and streaming.

I also don't see them getting into the low powered PC or laptop hw scene for this. That's what Surface is, in effect, anyway.

yes, i think there will be no more specific gaming hardware from M$ after current gen, but their software IP like HALO, Gears and Forza will all switch to mobile and PC in future...

So much yes to that statement.

Microsoft historically came into the gaming industry because they saw Sony as a threat to their dominance to the PC/multimedia industry so they tried to partner with them. Sony denied them (unlike Sega) and MS vowed to pretty much stop them. Microsoft has always wanted Sony to be close with them but Sony has never wanted to partner with them when it came to their videogame console, so if they wont join them they'll try to kill them.

IMO There are two things that will happen:

1) The route of Apple with the IPOD and Zune where Sony would have to decimate Microsoft and they would bow out seeing they aren't penetrating enough of Sony's marketshare to go on.

2) If Sony quit the gaming industry, Microsoft would become bored and not want to dominate Nintendo, thus allowing them finally to bow out and no longer have issues with what they deem a threat.

I always found it odd that MS chose to make a console, which these days are little more than dumbed down gaming PCs anyhow, rather than focusing more on PC gaming. I agree that indeed, MS will come to their senses and do just that. MS is irrelivent as a console maker in Japan and their market is very small in Europe. Even the US, once their saving grace, has gone back to Sony. Let Sony take the hardcore console market. It is a relatively small market anyway, and shrinking. Focus on grabbing the millions of PC/Steam gamers out there. The could offer fun and innovative new PC games for relatively low prices, maybe shift focus more on digital content and take the Steam approach of having free and heavily discounted software (that aren't indie game cheap), and they could still flex their horsepower muscle, as the games will be on graphic/horsepower focused machines. 

Nintendo takes the kids, expanded audience, and retro gamers. Sony takes the hardcore console gamers who prefer cinematics/story/narrative, and MS takes the PC gaming nerds who stress horsepower/graphics/customization/and PC indie games.. Everybody's happy.