Yeah, this delusion about flops mattering is really head scratching. I think $399 would have been better but MS was clearly adamant about native 4k30. I think its fine to have a boutique system but $500 really isn't going to do much to move the needle for the install base. Flops was never an issue with the Xbone to begin with (even though many think it was) and I think MS is putting so much emphasis on it glazes over the real issues as to why the base system massively underperformed. Perhaps MS does understand that system processing power wasn't the issue, but the messaging and push for the X1X in advertising leads me to think otherwise. I mean fanboys and forum warriors care about things like system power since they are talking points but the vast majority don't give a shit they just want games to play at a reasonable price.
In another thread we landed on the trinity of power, price, and games as being the largest determinant factor in console purchases. And we could just about roll up everything else (in an ecosystem) into being modifiers that directly affect power, price and games.
At the base system level, xbox at one point in time, didn't have power, didn't have price, and arguably to the customers of PS3, didn't really have any games (coming off the trail end of 360). And to 360 customers, they didn't have power or price, so why not hop over?
That was where PS4 was really coming out on top here.
Since then, the only major things that have happened on the base platform experience has been that
a) the price difference, which now works out in favour of Xbox (especially consider the subscription passes)
b) the power difference isn't nearly as large of a deal as the launch had made it out to be. Both platforms run the same settings for a majority of multiplatform games, the only major difference being only resolution, in which xbox is missing about 30% pixels in most scenarios, though sometimes it does manage to reach parity, often at some hiccups compared to PS4.
c) the game difference has worsened in xbox's favour since launch, BC has dampened some of the pain I suspect, I assume not substantial though.
On the mid gen refresh side
a) the price difference on the units is there, but it is a fixed cost, the marginal costs of ownership is cheaper on xbox due to subscriptions services like EA Access and Game Pass. You're looking at 4-6 exclusives a year combined with any other 3P title launching on it, combined with other 100s of probably older titles. That's good savings there compared to purchasing 2 games at regular price of 59.99. You can also cancel game pass if you aren't interested in playing any of those games. so effectively cheaper than buying and selling as well.
b) Power difference between the mid gen refreshes is significantly larger than that of the base systems. Consistently more than 30% pixels on 1X, also seeing a lot of more higher graphical settings on the X when looking at 3P titles. The best place to play 3rd Party games is undeniably on Xbox unless you're specifically looking at outliers (which exist, just not many enough to formulate a strong argument with)
c) the game difference has worsened in xbox's favour since launch, though BC and the 1X enhanced titles probably makes it not as bad as it would be. If they can continue on belting out Xbox's greatest fan favourites into 4K enhanced, this will continue to be good for them.
So I think if you look at how xbox is selling comparatively to itself since YoY, it's been on the rise. When we account for seasonality and stuff, and Xbox is doing pretty good compared to how it started. So I'm not sure I would say they are tone deaf to not understanding the games concept, they certainly understand games are important, but games also takes years to develop. And while they have been waiting for that 'killer app', they've been working on some things to keep themselves in the game. Nothing that will turn the tide in their favour, but building that foundation again, to set themselves up for success for when the killer apps arrive (if ever) or to transition to next gen.
