I've been less active because we tend to go in circles a lot, but I'll restate my position:
1. The S stands for "Saved" Xbox as over half the sales were S. It's a good idea, even though MS could have had a little more RAM in the box and made it 6 TF instead of 4 TF. Still a great machine.
2. They should shrink the S into an M whenever it makes sense.
3. They should bring out the next Xbox whenever they feel like and shrink the X into the S form factor and just keep supporting 3 SKUs. I don't believe this is an issue for devs supporting dozens of PC GPUs.
4. They should have showcase titles for the new box from 2 or 3 of their 30+ studios. They don't need to follow Sony's lead.
5. They should produce 3+ AAA games every year and 3+ AA games as well. Bring them out 2-3 years later on PS/Nin
6. Keep pushing GP on Xbox and PC
I mostly agree with these points but for 1 I'd say selling more than the X isn't really saying much. Being the most popular of the least popular console makes doesn't mean it was a good product. Plus, X supply was constricted early on vs the S due to them redirecting them towards server blades during the semi shortage.
Honestly I think they would have been better off trying to beat Sony on price. I also think they need to examine why the PS5 would often outperform the X despite having weaker hardware, not that these levels of performance gaps are ever the reason for console sales.
Also, I hate to beat the dead horse but on point 5 they really need to make more games, good memorable ones at that. I cannot think of a single Xbox franchise still worth following (Forza maybe but that's turned for the worse and it's ultimately just a racing game, Sony has GT which is arguably better).
Not usually discussed here but I also think the controller on Xbox holds them back. Sony maybe goes a bit hard on the gimmicks but the PS5 controller feels 100x more premium than the SX controllers (as an owner of one, I'd even say the stock PS5 controller feels better than the pro Elite controller but that's a matter of preference). I find all this rather funny as I thought it was the opposite for last gen, the Xbone controller to me felt a lot better than the PS4 controller, which felt kinda cheap to me.
IMHO a huge chunk of the initial PS3 sales were to play Blu-rays as it was the best player at the time.
I'm not sure why that matters, Sony ironically wanted the PS3 to be a media center just like MS wanted the Xbone to replace the set top box. I'm not sure we can count those sales against them here.
Now that we're discussing X360, MS is in a similar but not identical situation to PS2/Xbox right now, which is perhaps why they want to launch early. Especially with 30 dev teams.
Now here I disagree: in the OGXB days they had a ridiculously hyped sequel coming for their next gen (Halo 3) and generally people were looking forward to seeing what they had planned next (at least, this is the impression I get, I was 5 when the X360 came out lol) since the OGXB was the first iteration and you kinda get a pass for mistakes made there.
Xbox is now a mature brand so I'm not sure people are still interested in seeing what they have to market considering they trashed all of their notably franchises (Halo, Gears, Forza), and even if you do like those games they are bringing them to PlayStation/PC/your internet browser via XCloud so why bother buying their hardware?