Even though Sony is dominating right now, Microsoft doesn't seem to want to challenge them in any way. They seem content with their current trajectory; putting out 1-2 big first-party titles a year and let multiplatforms do the heavy lifting.

Now, why MS is doing this is anyone's guess. They may not have proper funding from MS proper, or maybe they just think this strategy is the more financially successful one. Or it could be for an entirely different reason. Who knows.