The more I think about it, if true, this could either be proof those in charge of the Xbox division are still completely detached from reality, or an admission of failure and attempt to double down on the 'whales'.
This simply can't be a mainstream success. The infrastructure just isn't there, and simply has no hope of keeping up with enthusiast aimed media like games and 4K streaming/downloads.
If they decided to launch this because they're only paying attention to their own basically infinite, money is no issue, super fast broadband set ups, then there's likely no hope for the Xbox brand.
If instead they decided making a system for the super hardcore that'll spend far more than average, in an effort to lock them into the ecosystem and milk them for everything they're worth, that's despicable, and would imply they're considering giving up on not just the rest of the world, but even the American mainstream.
Kind of worst case scenarios here, and I'd personally say they're just throwing shit at the wall to see what sticks, but if this has any further thought to it than being a blind stab in the dark, I can't see it being an idea that came from a good place.