Gee, seems to me that the consumers don't seem to think it was a waste of money, what with that 2-to-1 install base advantage Sony built and all.
The "GOOD, MORE MONEY FOR EXCLUSIVES!" concept, besides just being comically simplistic in it's understanding of how divisions in a large business are funded, is based on a myoptic, last-generation mode of thought.
Sony was able to scratch and crawl it's way back to somewhat-relative install parity at the very, very tail end last gen by burning a ton of money building up a huge apparatus of first-party studios; this the tack I assume the Microsoft partisans are suggesting Microsoft should take with the Xbox platform in order to get back into contention against Sony this generation.
The thing is, this generation the development costs (both money AND time) for the type of AAA titles Gaf would commonly consider to be needle-movers for a platform have skyrocketed again, approximately 3x the last generation on average. Because of this it would be much tougher task to replicate Sony's late-last-gen first party successes this generation. The type of 75-100 person team $25-30 million dollar budget AA-AAA exclusives Sony propped up last generation simply don't exist anymore. Sony itself had the foresight to realize this at the onset of this generation, and changed their approach.
The fact of the matter is, while grotesque and incomprehensible to most Gaffers, having something like exclusive marketing rights + one month timed exclusive DLC for Call of Duty is exponentially more important in the actual market than a well-reviewed and well-selling exclusive title such as Horizon: Zero Dawn.