If either Microsoft decides to do this, they will fail and basically hand their entire share of the console market to Sony.
If both Microsoft and Sony do this, and Nintendo does not, then it's up to Nintendo to find some way to capture the Halo and Call of Duty playing market.
If they fail, we are seeing the first signs of the end of the console gaming era. Either that, or Microsoft will realize they f***ed up and switch back to not f***ing over customers, which might happen if Microsoft are even slightly smarter at business than Capcom.