I think they'll put out a streaming stick for 100 dollars which includes a controller and that will largely be their strategy going forward. Not to compete directly with Sony over AAA titles anymore, but to really focus entirely on the cloud space and try and sell as many dongles as possible.
You plug it into your tv's hdmi port, it has an ethernet port and built in wifi, and wireless for low latency controller. Maybe bluetooth maybe not. You log in, you either create an account for GamePass/xCloud or you log into an existing account.
Instant access to games.
Cloud only future will undermine gaming PCs and Windows. Will shift user base to mobiles/ tablets, exactly what Google and Apple want.
Despite owning infrastructure, this seems to be primary reason why xcloud is not best streaming service out there.