MS didn't, but members in this thread have said the sharing situation was extremely obvious with zero confusion, and only idiots and fanboys confused the situation. Hence my interest in finding out exactly what was communicated when to decided for myself if it was MS's poor communication or the public's misinterpretation.
By accounts, it wasn't until the 6th June that MS actually explained what their sharing policy was, to whoever happened to go and look it up, which means -1 point for MS for miscommunication.
Given three games in your shared library, X, Y, and Z, and three family members, A, B, C, if A is playing X, can B and C play Y and Z, or can only one game in total be shared from your library and B and C would have to wait their turn? The phrasing suggests the latter, which would be incorrect. A clearer statement would be:
The specific pronoun 'each' is very important in being clear.
From what I can see, MS's original communication was non-existent. During the May 21st reveal, they could have shown a little promo vid (similar to Sony's UI vid that was released a little while ago) that showcased the user experience and how game sharing was a big step forward. Failing that, they could have released a very simple, obvious PR statement like:
Obviously a trained copyrighter spending more time on it could spruce it up. But MS failed utterly to communicate this. The end result was a lot of guesswork and confusion for a couple of weeks, by which time the miscommunication had snowballed.
Although the Internet failed to re-evaluate their understanding as new information came out, I don't blame the situation on them as Joker et al do. This whole sorry mess is principally down to MS failing to communicate their vision. Considering shoe-string budget Kickstarter's are capable of creating really swish, informative promo videos (DSLRs for the win!), it's pretty shocking that MS can be so clumsy in this regard. They need to update their whole PR and Communication division to get with the programme!