Because they though the XBox One could be their magical convergence device that they missed the boat on when they let Apple beat them to the smartphone and tablet.

So XBox One I think was their hope that it would be the "iPhone of the living room", aka: the one device that does everything you need in that area.

Also if you know the history of the XBox, the XBox was always supposed to be like a living room set top box, not just a game console. In fact, Bill Gates was not happy when the original XBox was streamlined down to more of a traditional console that didn't actually run full Windows. 

Most have cable with digital! There are very few all digital households out there .And for the 5 to 6 years that Xbox one are around cable/satellite providers will still be dominant. Things like Netflix are more of a side add on, rather than the primary option.

I guess MS wanted everything to be operated with Kinect and XBox One to become the central box in the living room. However the younger generation doesn't care much for cable anymore, while the older generation don't want another complicated device between them and tv. I'm in between but also a videophile and wouldn't dream of putting another step in the signal chain, tuner -> quality amplifier -> tv, nothing else.

We still use cable because:
- Internet caps and unstable bandwidth. Cable tv is simply better quality without restrictions.
- Ease of use. DVR what's on from a limited menu. Easier to decide what to watch together when the choices aren't infinite :) The paradox of choice quickly rears its ugly head when trying to decide what to watch on Netflix.
- Most of the shows my wife likes are only available on cable. (legally that is)
- Flat fee, all in one service, 24/7 customer service.
- We fall asleep with the tv on, would suck if the meter keeps running...

My kids are mostly on YouTube and Netflix though. They don't care about the quality or interruptions and watch the same crap 50 times anyway. I usually get burned out on series on Netflix by watching too many in a row. Most shows work better in a weekly format to stay interesting.

It certainly makes you wonder, to say the least. It seems bizarre to me that they wouldn't want to alternatively offer cloud based television since that's been their main schtick this gen

Focusing on TV was not a bad thing. More and more people are watching TV shows but on other services like Hulu and netflix.

The only reason I have cable is because I moved to the side of town closest to mountains. Before that all we had/ needed for the past 2 years was , netflix, hulu, and amazon prime, (we had over the air channels for the NFL).

 I also noticed alot of people wondering why MS did not go the way of Sony with Vue. I'm sure they actually thought about this, but they would have run into the same problem Netflix, and every other streaming service will run into. having to pay the internet provider extra to not throttle service. Cable companies hold more power than people think, just by owning the pipes that content is being delievered. I personally can never use anything less than cable. DSL is horrible, even Dish and other satellite TV providers will usually try to say you to take their TV package but keep cable internet (if you already have it). because they suck so bad. 

I think MS purposefully designed the Xbox1 to play nice with Cable in the hopes that they eventually decide to offer it as an alternative cable box. on a rental, or RTO program. 

Idk but I personally find it useful. Now AA batteries, that has me questioning MS.

This has never become a problem for me.