It would still be idiotic to drop the HW. I cant go much into detail since im on a phone right now but here are some reasons.

MS makes lots of money from xbox live so dropping that and keeping it free on PC is a mistake.

The xb1 is not selling bad its doing like 8ml units a year which may not be as good as the ps4 but still isnt bad at all. 

The next console is already in development.

Third party deals they have still last for a few more years.

Pc games and xbox games sell around the same or sometimes the xbox game would sell more. An example of this is fallout 4, the elder scrolls online, cod etc. So whats the point to limit themselves to pc when they can make double the profit on both platforms.

Only 3 huge xbox games have gone to pc. Qb(alan wake was also on PC), Gears UE(gears 1 was released on pc) halo wars 2(rts are better on pc).

Windows store cant compete with steam because the only support its better are from mobile devs and MS, while Steam has much of 3rd party games, and PC exclusives.

Xb1 is still much cheaper than a gaming PC so to a regular consumer who is interested in its exclusives would get the xb1.

The xb1 is the gateway to the living room for MS. Many companies have been trying to get into people's living rooms. Apple with its Apple TV. Valve with its steambox. Amazon with its fire TV.

I still think MS will continue to make xbox hardware for atleast one more generation. 

Won't happen unless they finish last in the console race. The xbox fan base that avoid computer gaming will sooner jump to sony's consoles than just become a pc gamer. once the number of those people committed to xbox is high and profitable enough, they will continue to actor to those people.

I did not know they've said such thing but.. All the time MS is accused of lying, PR spins, dishonesty etc so why is this statement still considered true?

But if the PS5 uses windows it will be part of their platform anyway.  It would guarantee Microsoft 100m extra windows sales but more importantly sales to dedicated gamers.  

Again Sony are in control so are probably happy they can go their own.  Especially when the ps4 OS runs better than the x1 OS

You're going to have to link me to get the context of that statement. Personally I don't buy that they made Xbox to protect windows. You're trying to put round pegs in square holes. For me MS saw how the gaming market was expanding and they wanted a peace of the pie. 

Sony already has PSNow, which will eventually support PS4 games.  Its really to early to know what Nintendo is going to do. Also, its not greedy for a platform holder to release content exclusivily for its own platform (not sure what you are responding to here).

It does make a lot of sense and the console market is shrinking, despite the PS4 selling really well..

Whether they will completely switch, only time will tell

I agree. This is why MS should make games for PC and Xbox and not fade the xbox out. Limiting themselves to one platform would be a mistake when there a chance they could makes 100% more.

Can't find the link it was along time ago but Billgates said the reason they ok'd xbox was they saw Sony's success and how much  Playstation had grown the market and Kutaragi talking about making playstation the centre of the home starting with PS2, this goal was seen at the time by many as being almost inevetable the only question seemed to be  , when and whom .

MS where concerned they Sony with their entertainment arms would succeed, so they entered to stop Sony owning the home and how Sony leveraging that could impact windows, another driving factor was it gave them a completly closed ecosystem something they lost out on with windows.

Thank you. That's a little bit more of an explanation. How true do you think that statement is and how much weight do you that reason truly holds to why they built the Xbox?