I can’t say I buy this fully. From a marketkng standpoint, it seems like a huge win: “Subscribe to game pass ultimate and you get thousands of games old and new, up by thousands from last year”. From a financial standpoint, running those emulators should be a lot less compute heavy than current games so it should be cheaper.

The only real issue I see here is legal. Licensing the rights to distribute the games via streaming for their entire back catalogue can’t be easy.