Software and services aren't really a problem for MS right now. Its their hardware division which is declining year over year. They aren't selling enough hardware. As a result the growth is nonexistant. Its only a matter of time until the hardware diviion start losing billions which will start really impacting their software profits.It's not even about competition it's about how much gamepass ruins software sales. Everyone in the industry has seen what it does to sales of games on the xbox platform, it took a platform that was already a distant 3rd in sales splits and more or less eradicated it. The majority of the motive for MS going multiplat to begin with was because gamepass hurt their revenue so much and failed to keep growing.
So why in the world would anyone else want that mess on their hands instead of sitting back and collecting 30% of all the sales of xbox games? Gamepass is a failed experiment and no one wants anything to do with it. Even bobby kotick said it'd be foolish to put activision games on the service.
They won't have that problem if they can tap into the playerbase of Playstation and Switch. These platforms don't have a growth problem. If anything they lack new software features/strategies to take advantage of such large install bases.
Without that roadblock, everyone involved will make a lot of money. Nintendo/Sony will be collecting 30% of games sales and recurring fees. There is no reason to turn down hundreds and hundreds of millions every year for having gamepass on your platform. These suits including Spencer will make a bunch of back door deals behind the scenes that will give them a big enough cut for everyone to be happy. That is just how I see it happening. Maybe I'm wrong but once all these 1st party Xbox/Activision/Bethesda devs are fully on board releasing games everywhere...the next logical step will be to negotiate for some form of gamepass on those devices.
Once enough software is ported....It would reach a point where it would be no different than having Ubiosft+ on PS5. If they don't have a problem with that I don't see why Sony would mind gamepass. Both Nintendo and Playstation have the backend infrastructure to support it.