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Windows is everywhere but the Microsoft Surface products still have value to Microsoft. Or for that matter, Steam is everywhere but Valve still made the steam deck. There seems to be some value to software companies making hardware if only to help set the tone and introduce features or ideas they hope other companies who use their software will follow.
That said, I wonder if we won’t see the Xbox brand transition to software only with a line of gamer targeted Microsoft surfaces advertised as Xbox ready.
Those are the standards and those products have value. Buying an Xbox when Playstation has all games for both consoles makes no sense unless you just have to have Gamepass, specifically.