If they release all the good Xbox games for PC, then who would buy an Xbox?
The exact same people who buy the Xbox currently; the casual market, kids, and hardcore gamers who just have to own every console.
They know what they're doing. They need games exclusive to Xbox so people buy the Xbox over a PC.
I don't see how this follows. The problem here being, obviously, that Xbox already has very few exclusives, and certainly far fewer than PC does. Thus, anyone concerned with being able to play the majority of critically acclaimed exclusives is clearly going to be going for the PC. I'm not saying that in some attempt to pcmr rah rah for the PC, it's just the reality.
And let's not forget that the PC market is huge, and you need a copy of Windows in order to play. That's just software, no need to physically produce, manage, ship, and maintain hardware. They still make the same money from the sale of the game, and they gain an audience of new consumers that is considerably larger than the one they currently have.
I know PC gamers are generally not going to buy an Xbox, but a lot will if the Xbox is the only way to play some great games. A lot of people are not PC only. Yes, they are probably hurting themselves by not accessing the people who only play on PC, but they most likely have done an analysis that showed they can get enough people to buy an Xbox if they keep Xbox games from going to PC.
That's just complete speculation. I find it extremely hard to believe that Microsoft has more to gain financially from selling a small number of additional consoles, vs selling huge numbers of additional copies of their largest franchises. There's absolutely no way that the profits on those additional xbox sales could match the profits from releasing forza and halo on PC. Just no way, it doesn't add up.
Additionally, if a PS4-only user wants to play Forza and it's out for PC, then they might build a PC instead of buy an Xbox.
That's still good for Microsoft. It's Microsoft Windows after all. Gamers fucking love Microsoft's product right now for gaming, it's the hottest platform in gaming right now. Yet Microsoft completely ignores this giant market of gamers while they dick off with their little my first game box and put all of their best products on the weakest selling gaming system on the market. It's just plain dumb.
For people like us who will probably never buy an Xbox, it sucks. Microsoft doesn't care about us because having people buy one game is not as good as getting people to buy the console. Once they get the console in your house, then it is easy to push even more exclusive games on to you.
It kinda sucks, but whatever. Mostly, for me, it's just flabbergasting why Microsoft refuses to engage with it's biggest install base. I mean, it'd be nice if there were a couple of great microsoft exclusives that I could play each year, I'd definitely buy them... but, meh, I can certainly live without them if they don't want my business. I've got plenty of other games to play.
They are only dedicated to the PC community in that they want us to continue to use their OS and possibly app stores. Caring about PC gaming does not mean they will cannibalize their latest console by putting exclusives on PC.
Right, we all know the situation. The problem is that it's just bad business.
Tl;Dr: If all the good games are available on PC, informed buyers will buy PC not Xbox. This hurts MS.
This is already the current paradigm.