It seems pretty clear to me that Sony is better at managing their studios, at making games, and at fostering creativity than Microsoft.
That's a hard thing to beat when the experience playing games is what matters most at the end of the day, and seems to be the hardest thing to get right.
Microsoft should be open to learning from Sony.
Whether that's the skill set required, the right people needed, or changing how they relate to their developers.
Going to war and destroying what is clearly working somewhere else will likely lead them to destroying those needed qualities at home.