Had Microsoft entered the industry around the same time as Sony then their money would have made a bigger difference during the third party moneyhat race. Microsoft's biggest problem is that by the time they entered the industry Sony had already locked down third party support and most weren't willing to simply ditch them like they did with nintendo. So yeah had Microsoft entered earlier their money would had secured better support and even more exclusives than Sony which would have made a more attractive platform from the get go.

In all seriousness... I think things would have been worse for them. There are three interconnected reasons...

1. They wouldn't have secured a partnership with SEGA (Dreamcast), nor would they have get introduced in the "intricacies" of the console market established by the Japanese companies.

2. Without the experience/connections gained with SEGA, they would have failed so spectacularly that their consoles would have been just two more insignificant western machines...

3. Two massive commercial failures might well have negatively impacted the bold decisions that paved the way for the Xbox 360's success. They might have lost faith in the Xbox's potential.