I think this topic badly needs this chart.

If Nintendo and Sony both have similarly powerful systems Microsoft has to follow them even if they can take the loss. There is no way that just the xbox would be able to support developers in such a high end environment unless it starts destroying sales records. Unless both the WiiU and PS4 bombed in this hypothetical situation MS would be in a Wii like situation with none of the benefits thanks to the much higher development fees and an almost assuredly much smaller userbase. Xbox is shitty enough for Japanese games already but imagine it without the PS3 for the games to be ported to and from.
That's right, Microsoft needs to have a profitable business model in the next gen. As the chart shows, Microsoft has only recently started to finally climb out of the hole they dug with the Xbox brand from 2001-2007. The cost of the 360 alone lost them several billion and that's not counting the billion more RRoD lost them. If Microsoft was to release a much more powerful system like the 360, they'd instantly lose all the money they made in the last 4 years and end up making the current hole much bigger.
Even though Microsofts a huge company, the shareholders of the company are not happy with the fact they've still lost 5 billion on it, and if the gaming division was to lose another several billion on just releasing a new system alone, I'd expect the Microsoft games division to be shut down and everyone involved with it fired from the company. Companies like Microsoft are in the market solely to make money and if you have a certain division that's almost a decade old and continues to lose money instead of make money, it won't be around for long.
If the people running Microsofts games division want to keep their jobs, they'll need to release a new system that's actually profitable this time. Because if they release another 360, they're all gone.