Apparently with those leaked MS docs, their strategy was, if GP doesn't grow enough by 2027, they exiting the gaming market. GIGALOL
And they're already stagnant in 2022.
Even when they realized they had no games when Starfield/Redfall got delayed and they went shopping there wasn't much to buy. Publishers were either unlikely to put the big titles on gamepass, unlikely to have capacity to develop a PC version or they thought it unlikely the game would be a hit (Baldurs Gate 3 lol).
I just don't see a scenario where enough big games are released every year (let alone exclusive) that ensure such growth. For that to happen they probably need to chase something like HoYoverse, not WB Games.
The original plan was probably to put Call of Duty on GamePass but with all the 'deals' they had to cut with other cloud services that becomes less and less appealing. The Series S | X split being 75/25 also isn't a good sign for where things stand.
The entire back catalogue of Activision on GP? Neat, but hardly game changing. Browser gaming or streaming through a TV or smartphone app will never be the #1 choice to play videogames either.
Handhelds from companies like ASUS will never reach the popularity of Steamdeck or the mass market distribution of Nintendo.