Oh yeah, just a little viable marketplace..
Steam is still king and Epic Games Store has built up a base faster than Microsoft did.
For third party publishers, they've created a viable platform as they don't have to worry about any first party software like they do when they opt for Nintendo or development difficulties like Sony used to have but fixed with the PS4.
You mean, the Xbox platform? The one that represents the vast majority of why they sell Gamepass, and their "content"? The only place they are really making money from licensed sales since Windows Store is a total flop?
Currently that is what they sell GamePass on. But with consoles becoming more like PC's the benefit of those boxes is diminishing.
Also, most of the best selling content is not made by Microsoft.
What exactly is this "slow burn" you are imagining?
They sell off Mixer, an abject failure that had like .5% of the market.. slowly burning towards what exactly?
I am imagining Microsoft to focus on GamePass and the Xbox Studios brand and less on the hardware and social-networking side of things.
For which Facebook seems a suitable partner.
Mixer was a financial disaster; your options are to dissolve it or sell it.. and likely the only valid suitor would be.. Facebook, since they aren't your competitor like the other 2 big companies involved in game streaming. Reading any more into it than that is just nonsense. Vast majority of your post is about why Facebook might want to buy XBox... your only reason why you think MS would want to ditch Xbox is the outright lie that they aren't making money on it lol
In terms of investment and return the Xbox business has not been the most profitable for Microsoft.
The effort they have to put into it every generation to basically 'reset' the strategy and brand means that no long term plans actually work out.
What outside of Forza/HALO and Xbox Live has had staying power?
They basically keep chasing the market, losing ground in Europe and not gaining a foothold in Asia.
Xbox One sold about half of what Xbox 360 did and Xbox 360 basically launched broken af.
Because Xcloud is not ready for prime time yet there's currently a need to sell Xbox's but in the future those boxes will be redundant.