Or it's the entrance to your home, entertainment-wise. How long do you think that cable companies are going to be putting these hideous, power-eating, under-performing boxes from Motorola / whomever in your house, which serve essentially minimal purposes. In my hypothetical future, game consoles replace those. Why have 3 pieces of hardware when you can have one (wifi router + cable box + xbox)? As TV changes over the next X years, I think Microsoft is positioned very, very well to make moves in this space. They have the weight to lean on the Comcast / Verizon / Cox / Turner / take your pick, and the technical ability to make things work.
Looking further down the line, you can see a future where home automation is centered around your central console, another area where I think Microsoft could make some moves. In a sense, they could own the operating system of your home. But this is probably a decently long ways out, so who knows.
> How long do you think that cable companies are going to be putting these
Well, as long as they are "free" and subsidized by bills. People like free, and cable companies usually give out the ancient hot DRM DVRs for free with subscriptions. I don't see people lining up to replace their DVR with an xbox (which isn't an actual replacement, it has no coax in or tv tuner).
> Why have 3 pieces of hardware when you can have one
Xbox doesn't have DOCSIS either. You can't put a cable modem in it. You maybe can use it as a router, but you can use anything with a land line ethernet plug as a router, or you could get a hotspot as a router.
> you can see a future where home automation is centered around your central console
I see this, but xbox one is so locked down, expensive, and it uses gamepads, not tv remotes. I don't see people keeping the xbone on as a media sync server, when you could buy a router with attached storage for a quarter the price.
In my mind, the end user wouldn't pay $400+ for the device, it'd have wifi and whatnot built into it. The content delivery system would subsidize the cost. And honestly the majority of the market could give a shit about being locked down.
Looking further down the line, you can see a future where home automation is centered around your central console, another area where I think Microsoft could make some moves. In a sense, they could own the operating system of your home. But this is probably a decently long ways out, so who knows.