You lost me here. The solution is to improve library portability and backwards compatibility, not clinging to increasingly-obsolete physical formats.
Imagine putting a cartridge in your phone for every app. Insanity.
(Luckily none of them are for the Xbox, since Xbox doesn't give a shit about game preservation even if you have the physical media.)
I can continue buying SD cards and putting them in my smartphone far after my smartphone vendor, OS vendor, or other developers stop supporting it. On an old enough digital-only console, there may or will be no way to use software that has been purchased for it. There are currently not ways to use software that could be purchased secondhand on consoles because there is no individual market or transfer option for it.
It's a scam.
Game consoles used to mean plug and play instantly and it works every time, but now it means subscriptions and mandatory updates and installation processes and different hardware levels (pro, regular; series x, series s), it's become a bad deal.
So companies move to PC, and now every company has a "client" to try to walled-garden their own games (blizzard, epic, steam, ubisoft, whatever bethesda formerly had, microsoft store, etc).
Games should be games; not work, not con jobs, not contractual obligations.
We need laws that fix the ability to resell digital-only games and programs and media. Whether or not storage is removable.
The analogy isn't about backing up and exporting games you already own, it's about continuing the use of hardware you own beyond the vendor's support.
Sideloading APKs allows management of software independent of a vendor app store. Do USB drives for game archival allow you to install any game, whether or not you bought it from the console store?
In the game industry specifically though, Microsoft has many faults:
Microsoft made Halo an Xbox exclusive when people were waiting for it on PC, so how can they complain about anyone blocking anything? This wasn't the only time:
Halo 2 was a Windows 7 exclusive because they soft-locked it to some version of DirectX they wouldn't release on XP, and it took the pirates 5 minutes to make it work on XP, clearly that was artificial.
Microsoft promised that Rare's upcoming game Kameo would be on the Xbox, but they converted it to a 360 exclusive to try to drum up sales for 360.
They started charging people to use their own internet connections with Xbox live, so we all played on VLANs with the games on LAN mode, now every game company charges to play online.
Anyway, Microsoft is a terrible company, always has been, always will be.
They also invented Pluton, put ads in the start menu, blah. Don't give them money.
This push to move to subscription may ruin gaming as an artform, and the more these companies fight and fuck that up, the better. Hopefully if they bicker enough it'll ruin the whole concept of a subscription.