These people just need to be honest with themselves: what they really want to say, is that
THEY want Xbox to stay around, not that Sony "needs" Xbox to compete.
And that's totally fine if that is how they feel.
What I
don't like is they're afraid to just say what they really mean. Nintendo doesn't seem to need a direct competitor in the portable/hybrid gaming segment to stay honest and deliver great games. Valve doesn't seem to need a direct competitor (in terms of substantial market share) in the PC game launcher/storefront segment to offer a great service for its users. Why does Sony "need" Microsoft in the traditional console segment as a direct competitor in order to continue delivering great games and features for their customers?
The truth is they don't, because even if Xbox hardware were to fold away (I don't think that is happening BTW, but just saying as a hypothetical), PlayStation would still have to compete for gaming time & dollars with mobile to some extent. With Nintendo, with Valve/Steam and PC, etc. There's always some degree of audience cross-over between the all of them and critically for Sony, in order to continue growing PlayStation they inherently have to stay motivated to be competitive and keep doing the right moves. But that's mainly an internal motivation and desire for success, it doesn't inherently need an outside agent. Plus, they still have investors and shareholders to answer to, not to mention the demands of their hardcore and core enthusiasts customers.
Now, do I "want" Xbox hardware to go away? No, not necessarily. The stuff I've been saying about a more PC-like direction hardware-wise should've been enough indication of that. I never want to see platform holders leave altogether; it still sucks that Sega stopped making consoles, for example. But I've been trying to rationalize that want for Xbox hardware to continue, with the realization that if left unchecked Microsoft could've done some major, quite anticompetitive damage to other platforms with their M&A strategy. No I won't just forget about the emails or the specific, targeted M&A strategy they outlined. That was definitely a plan of theirs at some point and I think if ABK went through without a challenge, they'd be accelerating with even more big publisher purchases, IMO at the detriment of the gaming industry.
So for me, if Xbox hardware is going to continue to exist I'm most comfortable with that on a business model that isn't trying to be like that of traditional consoles. They want to buy a publisher? Fine. But get that console business model out of the picture, that way there isn't the lingering threat of disruptive, very potentially anticompetitive foreclosure strategies (or associated strats to bolster it like predatory pricing) around. And hey, they just also happen to maximize their revenue streams in gaming while doing so.
It also incidentally, just makes too much sense for Xbox hardware-wise going forward. The whole point of the division was to stop PlayStation from killing Windows, and Microsoft identified gaming as the biggest growth market for PCs at the time. They didn't want PC game devs to go to consoles like PlayStation and cripple Windows growth in the consumer market, and they didn't want consoles to destroy the DirectX initiative they had started only a few years earlier for 3D gaming. Those are the reasons Xbox was made; they all tie right back to Windows and PC. So wouldn't it be thematically fitting if the hardware went full-circle and adapted a business model to suit it, while taking the experience they've learned from making consoles over the years?
Xbox consoles have lost most of their identity over the years in part to Windows and PC, a lot of that of Microsoft's own doing which also helped feed the other competitor: Steam. On some level pushing Day 1 for all games to PC made sense, but in reality that strategy should've been more nuanced. Xbox execs come out saying the console is still their priority, yet they just announced
ANOTHER PC-exclusive 1P game at their Direct with Ara 2. Actions speak louder than words.
These rumors are only really upsetting hardcore and core enthusiast Xbox gamers; unfortunately for Microsoft they are by far the most vocal. Future Xbox devices that combined the benefits (and corporate strategy) of Windows and PCs with those of Xbox hardware would be enough in value proposition, even at an increased price, to get most of those same people to stay in the hardware ecosystem, and interest new people to join in ways stuff like BC and Game Pass weren't able to manage on their own. Casuals and mainstream aren't hearing about these rumors most likely, and even they are, aren't much upset about it. That's just how they are. To them, even if Xbox hardware basically became something like a (purpose built, semi-embedded) PC, if it's got a nice comfty form factor for some variant with pared-down specs at an affordable price, and still has the Xbox UI anyway...in their eyes it's going to still be an Xbox. Only now, one with actual use outside of just gaming and media entertainment, since it can also run Windows.
If that's not the direction MS are going in (even tho the OEM rumors strongly suggest it is), then I'll be okay being wrong on that. But regardless one direction we can all agree on they
definitely are going in, is becoming a fully multiplatform (including multi-console) games publisher.