I have to concur that Microsoft at best has a very confusing strategy and at worse has no strategy at all besides Game Pass. This is coming from someone who was a huge XBOX fan starting with the original back in 2001. Microsoft back then had a strategy which was to build the XBOX brand and push their exclusives. Back then Microsoft even had their own sports franchises competing with Sony's 989 Sports and EA Sports. They had killer RPG's like Bioware's Jade Empire and other RPG's to offer an alternative to JRPG's found on the PlayStation 2. Then they released Forza Motorsport.Considering the Switch outsold the Xbox One 3:1 yeah. Microsoft's current strategy just really isn't working. Power isn't everything. You need a reason to pick up the hardware and Nintendo offers that via. good exclusives and flexible form factor. Xbox offers...? Game Pass? They don't really have exclusives anymore with everything hitting PC and the PS5 versions often outperform so there's little reason to pick up an Xbox as it stands.
Today it's all about Game Pass and their exclusives have been underwhelming to say the least. Forza Motorsport on the latest consoles has been panned by XBOX gamers along with Redfall and Starfield. Then their #1 surprise hit Hi-Fi Rush suffered the axe by Microsoft's bean counters because the game didn't sell enough units. So they shutdown the studio.
So it begs the question, what is the real strategy for the XBOX division? Is it to just promote Game Pass and buy up studios to offer more games on their subscription service?
Meanwhile Nintendo has a strategy and it's eggs are in their 1st party games. They made a smart move by encouraging third party developers and publishers to use theie eShop.
Sony this gen has also lost some of its way as well. They have been criticized for not developing more AAA titles as they did in the PS3 and PS4 era.