I guess I am supposed to answer the thread title, not your silly question in the original post. As if anything Xbox could ever get me excited.
The PS5 conference set a low bar. People learned that they'll be able to play a Spider-Man expansion and some Astrobot software that Sony doesn't dare to charge money for. While the hype is still fresh, it can't take too long until people realize that none of Horizon 2, Gran Turismo 7, Ratchet & Clank and Demon's Souls got a 2021 release window. So what Microsoft needs to do in the first party games department:
"Here's Halo Infinite. This version was built from the ground up for XSX. You'll be playing it this holiday season."
"And here's Forza Motorsport 8. Same as Halo."
PS5 already wrecked. Apparently people care about what they can play in the near future.
Microsoft can show trailers of first party titles that are far out, like Hellblade 2. It's not like Sony managed to put any pressure on Microsoft with all their TBD titles.
Then go over a bunch of AAA third party multiplats and keep repeating that the best console version of every game shown will be on the XSX. Close out the show with the price of the console and drive the point home that the XSX won't cost more than the PS5.
Game Pass in the middle somewhere.
The bottom line is that realistically Microsoft couldn't have asked for a better PS5 event. Sony's only two top studios that could have had a killer app ready anytime soon were Guerilla Games and Polyphony Digital (both released games in 2017, as opposed to all others who released games in 2018-2020), and neither one of them is capable of hitting a 2021 release date by the looks of it. The hype machine for Sony's ultra fast SSD couldn't demonstrate any games to back it up. A large portion of the PS5 event was padding, plus not much gameplay was shown. Microsoft is in a good position here. Instead of the huge question being how they can compete with, let alone beat a behemoth, it's now a rather basic premise of simply don't mess it up, because a lot of things have been lining up.
No mention of the hat in the title, though...
You say Microsoft just doesn't have to mess up but people lose their shit over anything Sony does. Just revealing the PS5 logo made some people orgasm. Microsoft has to do better than "just don't mess up" to impress those people. Something crazy unexpected like partner up with Sega. They need "a megaton".
those who lose their shit about anything Sony does will never leave Playstation. They might buy an Xbox as well but not only an Xbox.
MS could have the best 20 next gen games exclusive on Xbox and those who lose their shit about anything Sony wouldn't stop to buy a Playstation.
MS can win over "normal" customers who aren't extreme fans of something. Those didn't lose their shit because of a PS5 logo, most won't even post in gaming forums at all.
I think it's save to say that Sony's brand name is so big in Europe and some other places that MS won't sell more consoles than Sony does even if MS will do more right next gen. But they could at least manage to take away a few million sales and make the Xbox brand more successful (not only with console sales but also with Gamepass on PC and so on)