Xbox has expanded its lineup of first-party studios in recent years, with notable additions such as Obsidian and Bethesda. However, court documents now reveal that Sega and Bungie were also potential additions to Microsoft's portfolio. These plans came to light during the ongoing litigation between Microsoft and the U.S. Federal Trade Commission regarding the proposed acquisition of Activision Blizzard. The driving force behind these acquisitions is Xbox Game Pass, which Phil Spencer, the head of Xbox, has consistently emphasized as a crucial aspect of the company's future in the evolving gaming industry.
Microsoft has been entangled in a series of hearings with the FTC, which filed to block Xbox's intended acquisition of Activision Blizzard in early June 2023. The proposed deal has already faced legal hurdles in the U.K., where antitrust regulators prevented its approval earlier in the year. As of now, the legal battle, which began in May, shows no signs of slowing down and is expected to intensify once Microsoft's appeal process begins in July. In the United States, the FTC argues that the deal would grant Xbox the ability to harm competition in various areas, including console sales and subscription services.
Following the initiation of Microsoft's FTC hearings, official court records have been made public, revealing the company's intentions of expanding Xbox Game Studios through potential acquisitions of Sega and Bungie in 2020. Contained within the documents are excerpts from an email sent by Phil Spencer to Microsoft CEO Satya Nadella and CFO Amy Hood, explicating the perceived benefits of the acquisitions and seeking authorization to approach Sega with the proposition. However, it remains uncertain whether Spencer ever formally contacted executives from either organization to discuss the prospect of joining Xbox Game Studios.
Sega was seen as a valuable addition to Xbox Game Pass, with its extensive library of IPs and potential for localized content like Persona and Yakuza to appeal to Asian markets. Xbox continued to prioritize acquiring Sega in the following years. Meanwhile, Bungie's potential acquisition would have marked a reunion between the studio and Microsoft after their split in 2007. Bungie had played a significant role in the success of the Xbox console line with their popular shooter franchise, Halo. However, Sony ultimately acquired Bungie in July 2022 for approximately $3.6 billion, gaining ownership of the Destiny series and the recently announced Marathon reboot.
Source: The Verge
