please fix your thread title.

I have the opposite perspective. MS doesn't need to lose money on Scropio because X1 S is going to sell more units regardless. Its cheaper (maybe $249 soon) and plays the same games.

I see the Scorpio is a long term plan, whether its $400 or $500 at launch. The average consumer will want the the X1 S that's also bundled with some AAA game. Down the road (1 or 2 years depending on launch price) Scropio should hit $300, people will want a more powerful device, and sales of the X1 S will decline for Scorpio.

If PS5 aims for the sweet spot of $399 in 2019 or 2020, I'm not sure it can be significantly more powerful than Scorpio while being profitable. People think Scropio is too powerful to hit $399 now, so how powerful can PS5 be really at $399 in 3 years? Look at PS4 Pro, its 3 years later, $399, but not significantly more powerful than PS4 and considerably less powerful than Scorpio.

I also believe MS will want Scropio supported along with the next X1. While PS4 and PS5 maybe not share outside of BC.

Phil Spencer keeps talking about the importance of exclusives, we'll have to wait and see what becomes of that. But less notable exclusives than PS4 shouldn't negate the fact X1 does have some great exclusives. As I said before if X1 can simply maintain its current sales then that's good enough, it would achieve 360 userbase eventually.

Simply put - nope.

I'm happy with my Pro. Can't wait for the PS5.

But the point is that Pro and Scorpio power was in vast measure dedicated to achieving 4K (checkerboard/real-deal), period.
And there is no resolution bump beyond 4K on the horizon ~2020, consumer TV standards will still be consolidating around 4K then.
So not needing to push more pixels, all power boost can go towards CPU, FX, GPGPU, i.e. actual substance of "next gen" experience.
Scorpio dedicates 1 of 4 gig RAM boost to OS' frame-buffer, while if res stays @4K, all of PS5 RAM boost can go to game resources.
The "half-gen" "tick", pushing resolution early, exactly leaves next "tock" to dedicate it's improvement to actual next-gen gameplay.
Merely with same degree of power increase.  
Although it's very plausible they WILL push performance more (relatively) given it will be defining parameter of next-gen gameplay.
And there won't be much other purpose of the new gen given 4K resolution would already have been on the market for ~3-4 years.

Right. And that was with relatively long gen, where PS3 only eked out ahead towards the end.
Assuming PS5 drops in 2020 (dictated by AMD schedule), 1 year lead = 33% more sales.

But I think too many are still stuck in paradigm of there being some equal contest between Sony and MS,
with either in plausible contention for surpassing the other in sales. There isn't. Sony global brand is too strong.
That doesn't impede MS from running viable, profitable business while permanently underselling Sony.
And with that in mind, abandoning aim for launch parity/advantage along with aim for actual sales advantage,
and aiming for higher performance at higher price with later launch is a reasonable approach with valid niche.
All the more so with "half-gens" which allow both parties to offer attractive hi/lo products for all ends of the market.

Pro and Scorpio don't just focus on resolution. There are numerous examples of resolution being the only upgrade, but there are also alot of games using the extra power for a resolution bump (often 1440 and 1800p), better frames, and higher graphics settings. The Scropio will do the same and from we know it can achieve 4K while have room spare for other improvments in X1 games. Forza 6 for was patched for Scorpio, was 4K/60 fps, while only using about 66% of its GPU.

I anticipate PS5 will be able to achieve 4K on a more regular basis. But at $399 and perhaps only a few years from now... I'm not getting my hopes too high. Even PS4 Pro games settle with 1080p to achieve better graphics and frame rate.

Yeah, I agree it could work. But it is still a gamble on their side. They are trully pushing the Scorpio specs wise (it is impressive on a hardware level) the question is how much ground can it gain in 2-3 years and how much their bet on the True 4K will bring. IMO they still have the odds against them, but if anyone can pull it off, than that is MS, as they have by far the largest financial muscle from the 3.

I actually feel MS is playing it pretty safe with Xbox. X1 was never sold at a significant if any loss, we expect more of the same Scorpio. The era of selling hardware at a big loss is over.

As far as software goes, they're arguably playing it too safe. They need to invest more in exclusives, that's definite. If they're willing to launch a more powerful X1 then surely they're ready to invest in games.

The odds that are against them is surpassing Playstation, its just not gonna happen. But if they can acheive a userbase of 60-80 in the next 4-5 years, then Xbox is still very relevant and worth supporting.

Since Scorpio doesn't have Vega's double rate FP16 half float feature, how much of the gap could be made up between Pro and Scorpio realistically? Surely not the 8.4TFlops that Cerny said is technically possible.

Could Pro be brought up to 5Tflops, 5.5Tflops, 6Tflops, with proper optimization? I would assume most third parties probably wouldn't take all that much extra time and optimize to push this, but the PS first parties most likely would going forward.

Is FP16 mostly marketing, or does it actually make the specs race potentially closer than it seems on paper?

No. Sony can do whatever they want, this gen Microsoft just fucked up so hard that not even Scorpio at an affordable price and good games will save them.