The transition to PC is nearing completion:

In a speech to reporters, he said that the Xbox One could see a future in which it is upgraded, rather than replaced by new consoles. Spencer was talking about how Microsoft has sought to align its Windows 10 and Xbox One development activities under the internal "Universal Windows Platform" while offering backwards compatibility for many Xbox 360 games, now playable on Xbox One. He was addressing the concerns of some Xbox One owners that the exclusives destined for that console are appearing on PC, thus eroding the value of owning a console.

..."When you look at the console space, I believe we will see more hardware innovation in the console space than we've ever seen. You'll actually see us come out with new hardware capability during a generation allowing the same games to run backward and forward compatible because we have a Universal Windows Application running on top of the Universal Windows Platform that allows us to focus more and more on hardware innovation without invalidating the games that run on that platform."

http://www.polygon.com/2016/3/1/11121666/xbox-one-hardware-upgrades-phil-spencer-microsoft

Xbox Two.... just like Xbox One... just better hardware.

I guess this means hardware backwards/forwards compatablity, and MS supporting 2 gameing markets at once (two, and one).
My guess? same games and the biggest differnce will be the Xbox One games will drop in resolution, and the Two, will play them at higher ones.

Normally I am not a fan but I really dislike how weak consoles feel this generation. I am already spending a lot of time on PC and with all this vr devices coming up it is going to be harder for me to come back.

All I saw was PR and no straight forward answer.

Cool, I'd like to be able to upgrade my console without the need for new hardware. Could be interesting.

hmmm.
and how?
The visual inovations wouldnt be generational anymore?
they wont need more power for run the next year upcoming games? Just adjust the resolution? So, the concept of generation would no more exist?

I remember they talking about the cloud power. would the extra power for runing the upcoming games on the old xbox one come from the cloud?

Several consoles have had hardware upgrades in the past, so I don't really see why it would be inconvenient here (unless they start making exclusive games for consoles with such upgrades).

about the next xbox:

"You'll actually see us come out with new hardware capability during a generation allowing the same games to run backward and forward compatible"

Thats a pretty straight forwards answear, it means:

Xbox Two = will play Xbox One games, exactly the same as the Xbox One.

Xbox One = will play Xbox Two games, at lower resulutions, and still be able to play Xbox One games (if they still make those after the Two launches).

** Maybe its not a Xbox Two, but a Xbox One & half or something, but it ll be more powerfull, and be what game developers aim for, your Xbox One will run the same games just at a lower resolution.

I meant in terms of specific defined details on what their full plans were going to be.

Your plan is basically what console gens have been like, upgrades through the years, especially with remasters and remakes.

1) This isnt my plan, its a quote from the OP that Phil Spencer gave, about what the next xbox will be.

2) This is not what console gens have always been.

Imagine if your Snes could play all your N64 games, but at lower resolutions? did that happend?

How about if your n64, could play all the Gamecube games, at lower resolutions? did that happend?

Forwards compatability is something new. Its not just remasters (because thats only the new console,playing older games), this is about the old console playing new games (from a new gen console) on the older model.