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The PlayStation Portal remote player experience to evolve with new system update
(blog.playstation.com)
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From an outside perspective it's so strange that this thing doesn't work with Xbox live and other cloud providers. Or does it?
It does not. Currently, all it does is replace the "PS Remote Play" app you can put on your phone, which is basically just remote desktop for your PS5. Without a PS5, all you have with the Portal is a screen that doesn't do anything.
This update will allow it to stream games from Sony's servers, instead of from your own PS5. But it is still limited just to Sony's platform.