Regarding this whole hypothetical about Game Pass on PS consoles there's also a consideration of time. Any time a gamer spends on their PS console playing a Game Pass game via xCloud means that's less time they're spending playing a game that they either purchase from Sony or obtained from a Sony service like PS+ or PS Now. Unless Microsoft were to drive several dump trucks full of money up to Sony's front door or offer them some miraculous deal like, "let us put Game Pass on PS5 and you can use Azure for free!" then I don't really see that happening anyways.
PS will continue to grow and evolve PS Now to form another solid subscription revenue stream to go along with PS+. Hoping we find out more about their plans in August.