It's just going to take time. The software is simply behind the hardware. by and large devs are still using last gen tech on steroids and bolting on some stuff like ray tracing. we were warned a couple of years ago that there was going to be a 2 year cross gen period (and with the current shortages it could very well be longer).
its not the first time this has happened. it tooks 2-3-ish years for devs to get their heads around the PS3 and 360 too. software was behind the hardware (before then everything was single threaded and GPUs had more basic programmable pixel and vertex shaders). the PS4 and X1 were more the exception in that regard. they didnt really bring much new in terms of tech. they were more just a 360 with a GPU and ram upgrade (where the GPU upgrade was more just a brute force upgrade. no major new features).
To be honest i dont think this is an Xbox exclusive problem either. It's the same with the PS5 and PC. games are old tech ramped up to the nines with some extras bolted on. a couple of devs have used basic brute force with the PS5s SSD (R&C and 2-3 second load times is a very basic use). ray tracing has been basically tacked on to some games. but these games are not making the best use of the resources available to them.
The matrix and Lumen Tech demo are a glimpse of what the PS5 and XSX/S and DX12U compliant PCs can really do (i wonder why there is no PC version of the matrix tech demo? maybe it needs more QA to get working on different configs). They are a very clear step up from the PS4 and X1.
In terms of MS specifically: they have quite a few of their own studios now. one of the reasons to have a first party is to push the boat out.....to sell hardware (or in MSs case, get more subscribers) by making people go "WOW".
Traditionally The elder scrolls has been a technological groundbreaking game when it released. I remember the amazing water effects in morrowind for the time. the massive open world in oblivion and even the jump from oblivion to skyrim was quite significant despite running on the same hardware. So bethesda should be set a target: use every single tool the XSX/S has available to produce the most technologically stunning game the world has seen yet. to produce an open world with 0 loading screens (not done in Elder scrolls yet) that has an absolutely stunning attention to detail scaled across a large world. on a side note: i hope Bethesda are moving on to a new engine. Maybe using next gen ID Tech with a lot of collaboration with ID.
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