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Yesterday, we ran an analysis piece on Microsoft’s exclusives problem on Xbox One, laying out the reasons why a big acquisition makes sense for the company. We mentioned some of the rumors doing the rounds, including Electronic Arts, Valve and PUBG Corp. Today, we’ll address those rumors individually and hear from leading analysts, while also investigating other companies that might help Microsoft games chief Phil Spencer address his console platform’s shortfall against rival Sony.

“It’s going to cost a premium”

Larger independent developers are always on the radar of acquisitive companies, the largest and most successful currently being the likes of Double Fine Productions, CCP, Klei Entertainment, Telltale Games and IO Interactive, all of which have development heft and good brands. But those markers of success are often driven by independent leaders and a strong internal culture. Most of these are unlikely to want to sell. Individually, they wouldn’t make a big difference anyway in Microsoft’s exclusives shortfall against Sony.

In the case of EA, it’s one of the biggest third-party games publisher in the world, with popular brands like Battlefield, Dead Space, Mass Effect, Dragon Age and Titanfall. But much of its value is held in licenses like Star Wars and the NFL, rather than in the sort of exclusive IP that Microsoft craves. None of four analysts we spoke to considered it a likely proposition.

“EA’s market cap is somewhere around $35 billion,” said David Cole, owner of DFC Intelligence. “If the world starts finding out that Microsoft is interested in acquiring them, that stock price is likely to shoot up. Then you have to deal with potential antitrust issues, which can take a while. So it’s going to cost a premium.

“If you get them, you can just screw it up”

“It’s tough to buy a large publisher,” he added. “And if you get them, you can just screw it up. Microsoft’s track record in that regard is not that good. They had a lot of success with Bungie, but a lot of other things haven’t panned out so well. What are they going to do different this time?”

Michael Pachter at Wedbush Securities was equally skeptical. “You have to think that maybe half EA’s business is PlayStation 4 right now. That all goes away in a Microsoft acquisition, including all those licenses, which the holders will insist on being on all platforms. I don’t see it.”

In Valve’s case, an acquisition comes with the massive power of PC games retail portal Steam, as well as popular gaming brands like Counter-Strike and Dota 2. Microsoft is keen on exploring games as platforms, at which Valve excels.

But boss Gabe Newell (a former Microsoft employee) is known for his desire for independence, and for his often scathing opinions about Microsoft’s strategy.

Still, our analysts were all open to Valve as a possibility. They said that it would fit with Microsoft’s desire to leverage PC gaming and its interest in the cloud, while also handing over prize brands like Half-Life, Portal, Team Fortress and Left 4 Dead and offering an entry into esports.

“The Valve business fits very well with Microsoft’s cross-platform strategy”

“The PC and Windows as a primary platform is a strategy that might be worth pursuing, rather than the console market, and so Valve would make sense,” said Cole. “When Windows 10 launched, they jumped back into PC gaming, and then you look at initiatives like cross-play, you can see their priorities.”

But all this hinges on Newell. It’s possible he wants to focus on VR, rather than digital retailing, and might be willing to spin off Valve’s less interesting assets. But even if Valve were the target, it’s hard to see how this would help Microsoft’s Xbox One roster in the short term.

“The Valve business fits very well with Microsoft’s cross-platform strategy,” said Pachter. “Not to mention that they are 10 miles apart. I don’t think of Gabe as a seller, but it’s not crazy. Great IP and dominance in PC game retailing and big investment in esports? It makes a lot of sense.”

Then there’s PUBG Corp., which is riding high with PlayerUnknown’s Battlegrounds. “In many ways PUBG Corporation is the perfect candidate,” said SuperData Research CEO Joost van Dreunen. “But I think the interest in that company is fairly universal, so I imagine there is a lot of competition.”

We can all name just about any company in gaming as a potential Microsoft acquisition. But we can all just as easily note the various obstacles to any big-name deal. With that in mind, let’s indulge in some speculation.

Square Enix might be tempting for brands like Final Fantasy, Tomb Raider and Deus Ex, but Microsoft has been burned before in Japan, where the company invested a great deal of money into games for the Xbox 360 that failed to ignite. This goes for other Japanese publishers like Bandai Namco and Capcom, most of which don’t have the brands to make such a risky takeover worthwhile.

“I think they’ve probably resigned themselves to being in second place”

Ubisoft would be a pretty plum for Microsoft, offering great franchises like Assassin’s Creed, Tom Clancy and Far Cry as well as a hugely talented network of studios. But the French company has proven resistant to takeovers and is currently fighting off a hostile bid from Vivendi.

Activision Blizzard’s enormous price and the obstacle of its CEO, Bobby Kotick, make it look highly unlikely.

Take-Two has arguably the biggest game franchise in the world with Grand Theft Auto. EA tried to buy the company 10 years ago. But most of its value is in its subsidiary Rockstar Games, best known for GTA and Red Dead Redemption. A Microsoft takeover could easily lead to senior creative departures; Rockstar tends to work at its own speed.

Bethesda also looks like a nice bet, but there are potential complications with its larger holding company, ZeniMax Media.

Related The Xbox One has a serious exclusive games problem

“It’s easy to say yes, Microsoft needs to buy a company like that,” said van Dreunen. “But actually doing it is a much more complex thing. It usually comes down to who the board members are and what’s going on in their lives. Are there people on the board looking to ditch their shares? Or are they happy as they are? That’s what either facilitates or prevents these things from happening.”

In other words, Microsoft’s target may come down to more than just price and portfolio, but also timing.

“This is something they should have done in 2010,” said Pachter. “They just don’t have the depth, and I don’t think there’s much out there that they can buy.

“If they do anything, it will be PC-focused. I think they’ve probably resigned themselves to being in second place [in the console market]. I don’t think Phil is in danger of losing his job because of that. Microsoft wants the Xbox business to be profitable and it probably is.”

Pachter added that Microsoft may still find success this generation selling “60 or 70 million consoles when all’s said and done,” while strengthening Xbox’s ties to Windows 10 gaming.

“I’m sure Microsoft is always alert to potential acquisitions in the market but I believe it’s less likely they would acquire one of the major traditional publishers or games platforms,” said Piers Harding-Rolls, director of research and analysis at IHS. “I think they’ll be on the lookout for unique opportunities presented by studios or specific titles that are poised to make an impact on the market.”

Microsoft certainly has the money and the motivation to make a big purchase. But we’ve seen some clues from interviews with execs that the company may take a very different path from acquisitions and big AAA exclusives.

As head of games Phil Spencer told The Guardian last year, he’s interested in investing in games-as-service innovations. “Say there’s 10 people in a garage that have an idea for a service-based game. What does it mean for them to build up the infrastructure to go and create that game? How can we help them?”

In a call with investors in October, Microsoft CEO Satya Nadella said he is “fundamentally rethinking how we measure progress in gaming,” suggesting a move away from console domination as a goal in and of itself.

Ultimately, the company may decide to forgo big exclusives in favor of other initiatives, like the expansion of on-demand subscription service Xbox Game Pass, which will now include exclusive games at launch. It may be that the expense and intensity of exclusives — which often demand five years of heavy investment — is deemed an expense too far.