Microsoft's biggest issue, IMO, is that the XB1 is perceived to be a lesser value than the PS4. Some gamers might agree with that sentiment, some might feel they are equal, and some might even feel XB1 is superior (depending on features, exclusives, and tastes that are relevant, not on sheer spec sheets). NPD results indicate that the only conditions that XB1 triumphs over PS4 so far are when Sony literally doesn't have any PS4 on store shelves, or when MS is "giving away the store" by not only noticeably undercutting Sony's price, but giving away significant free games. That strategy carried MS through the holiday season, but it's not a winning strategy in the long term and it certainly isn't financially responsible. I am not personally of the belief that Microsoft will continue to subsidize the console to that extent if it's not pushing them towards the #1 position. Expenses have to be justified and if it's not moving them out of the #2 spot, it's money that could be better spent on other things.