No MicroSoft didn't expect Sony to release as suddenly as it did, simply based on the statement Kaz Hirai made about not going first back and January 2013 and then boom Feb 2013 reveal. They thought they would have a year head start again hence the policies they had.
Yup. Remember MS pushed their announcement back a month after that 2/20 dropepd. nikkaz was like
Kazcobar Season Has Returned....

I forgot about the reveal in Feb 13.
If Sony is selling PS4 like crazy pretty much everywhere, and in Japan it's no competition, where does the impending doom for them fit into your predictions??
consoles as we know it and want more enjoyable, simplistic gaming. These Cinematic games turn them off because they lack actual imagination and focus too much on the real world and relaism. Japanese games traditionally focus on pushing imaginations and gameplay. Now that is mostly gone from consoles, they moved on to phones.