I think this statement is being heard alot is mainly down to how Microsoft have been running things recently.|
Over the past couple of years its first and second party developers have crumbled or disappeared. Rare was dead a long time ago, but Lionhead losing 80% of its talent and Molyneux after Fable: Journey was surprising. Bungie being replaced by 393 studios is another example (sure there not bad by any means but its hardly like for like talent wise). Epic games starting branch out and Bizzare Creations going to Activision (and eventually going under). It doesn't really paint a good picture.
Then there is Kinect, which it is making said first party include it into all its games for the system (which may explain why there is such an exodus). Kinect clearly wasn't going to work after the first year. But because it sold well, they are still backing it 100% as a new control mechanism and its certain to be built into the next system.
Lastly, its the changes to the interface on the dashboard. More and more adverts. Indie games being pushed into the background. A focus on media, streaming videos and social networks rather than Video games first (which what made them so popular over the years and made Sony less so).
Its a culmination of many things they have slowly done over the past couple of years. No one thing has made them suddenly shite and the 360 is still a great console. But its starting to look like the constant progress and improvement they have been making since the first Xbox has peaked. They seem to be losing touch with their consumers (or more disinterested in them) and seem determined to chase the App and media streaming crowd instead. That's a mistake IMO.