Yeah, after loud public outcries and both Sony and Nintendo managing to tear a new one in Microsoft out at E3, they actually change their policies. It's still sad that it took that much pressure before they actually changed their policies. After all the damage was done and everything was said.
Granted, it's the dreaded "Third Console Curse" but then again, if you make an unwanted peripheral mandatory to operate the console, it's obvious who'll be out on top of this generation. Nintendo and Sony are both ready with lower prices. This generation, Microsoft has made absolute fools of themselves, and it doesn't help that Windows 8 sucks all kinds of supafly booty.
In many respects, a lot of what happened in the Game Crash 1983 is being mirrored today. Supersaturation of mediocre games and large number of game consoles means that there will be at least one console that will die. Despite the fact that Microsoft retracted their policies, the fact of the matter is the damage was already done and Microsoft's PR committed corporate suicide, and they're in severe danger of being that console that does die. I gave them a chance with the 360 and I could never like it, but at least I could respect the system for what it was. But the XBOne, well, they tarnished themselves, and they will most likely never recover.
I'm not saying they'll end up the same way, but what Microsoft did this year is very similar to what Sega did back in the day with the Sega Saturn. And we all know that Sega, after the Dreamcast, stopped making consoles. In short, Microsoft is in a lot of danger right now. It would take nothing short of a miracle to get them out of this debacle combined with making one of the worst operating systems in recent memory.
That, and the price point is the same mistake that Sony made with the PS3. Being the most expensive system will not fare well for Microsoft, especially since Sony actually learned from their past mistakes.