MS wants to win, their strategy doesn't "push the medium forward" but neither does any of it's competitors.
Neither are pushing the medium because the percentile of people that appreciate more complex stuff is limited, hence we are in a simplification era.
Nintendo is doing games for kids, I've been playing Mario Odyssey and it feels like a dumbed down mario experience for me in regards to gameplay accuracy needed, the same is true for most games they're devising. Sony is making walking simulators with third person viewpoints, and Microsoft is doing netflix of games with the same caveats as netflix (hollywood blockbusters don't come out day one on it, if at all).
Neither are doing what I would like them to. And I have to say, Microsoft's strategy is not bad, it's the best chance they have at winning this, but it probably isn't good for the consumer, not for this generation when they're undercutting, probably not good in the long run, once people are addicted to the gateway drug they'll rise prices like how Netflix is doing right now. This said, it's innevitable, and if Microsoft wasn't doing it someone would in due time.
The end game for everything "services" is raising the prices to the prices they want to command, which are not the prices they're making.
But the reality is Microsoft isn't immune to the economic realities surrounding GamePass anymore than Google was immune to the technological realities surrounding Stadia. Amazon will similarly shutdown Luna. Not to conflate GamePass with streaming, but it's just a difficult model to keep up.
It's not that different than a supercharged "games with gold". Biggest difference being that before they would negotiate the licence for the game and allow you to keep it whereas now they pay a fee to secure it on the service for a time.
They're doing a lot more games (but negotiate mostly in the same way, just not for the duration of one month but games come and go every month regardless), but also grew their userbase massively so it's an economy of scale at work plus offering everything they own day one. Without games with gold doing what they're doing now would be harder, which is why in the end one superseded the other.