Why Microsofts Going To Buy More Publishers/Studios

If you take a look back at 2013 and the state of Xbox’s first party when Phil Spencer took over it was a sad state of affairs. The first party consisted of 343, The Coalition, Turn 10, Publishing and Rare. That’s it, 5 studios. Recently they had closed the studio that made their Fable titles, Lionhead Studios.

There has been a drastic turn of events since Phil Spencer and Sataya Nadala discussed the future of Xbox with Microsoft and Phil convinced Sataya that it is a pillar of the company.

They now sit at 23 studios and looking to grow. So what happened? What was that drastic change? Well Phil outlined the market opportunities and strategies to reach that market. That market is 3 billion gamers and the method of reaching that market is through the existing infrastructure and streaming through their gamepass subscription service.

Now in order to go after such a large market, you first need to establish yourself, build reputation, spread goodwill among the user base and start establishing your service as the best and have content that can only be viewed through your service. Once you have a base you’ll need mass appeal and offerings that appeal to everyone.

Phil himself has said they are trying to be the Netflix of gaming and they are in the early years of that. He’s right about that and it shows. Microsoft has been working extremely hard to lock down premium content and build up their teams internally. They are building from areas of strength and past reputation by really building out the shooters and RPG content.

Right now, they are counting on those content additions and the internal build out that they have done to lock in that initial subscription user base that should quickly overtake their existing gaming revenue streams to prove out success while establishing themselves as the leaders in game streaming.

With that being said, I doubt they view Shooters and RPGs as what will entirely establish themselves as the leaders and I am sure they are well aware that they aren’t going to appeal to the masses with their biggest exclusives as Shooters and RPGs. They are going to have to establish themselves as the content leaders in a few other areas. They will diversify their offerings. To do that, they will need to acquire additional Studios/IP. Because they are early in building towards their goal of universal appeal, I expect they will try to make a play for a mass amount of content that fills holes in their portfolio but may also take a few areas they have offerings in and make them the undoubted leader.

There is also a ton of smoke that Microsoft is looking to make some splashes in terms of content. They reportedly had been interested in acquiring WB, Sega and Bungie and that’s just as far as what leaked (keep in mind Zenimax didn’t leak and there were 2 yrs of conversation). These are conversations that are more recent and would seem to be in addition to what they did with Bethesda and not off the table based on what Sataya Nadala said after the Zenimax acquisition of them continuing to be interested in adding even more content.

It is clear Microsoft recognizes the opportunity and know they need content and are not afraid to break out the wallet even further, so expect some more industry shaping acquisitions to happen from the Microsoft side to secure exclusive content and talent.

Published by xboxworlds

New blogger, passionate about gaming on xbox

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