When the original Xbox first debuted in the previous generation, it accomplished two things -- it introduced a viable threat to Sony's dominance in the home console market and it paved the way for greater success in generations to come. It was almost a platform for Microsoft to enter the fray rather than something perceived as a PS2-beater. It was a strategy that worked and apparently, a strategy that's still in place.
It's certainly not uncommon for Microsoft to play a long game (just look at the way it handles Windows) and it certainly worked last time around. Both Sony and now Microsoft have promised that this is going to be a lengthy war -- who's going to stick it out?