When Microsoft acquired Bethesda Softworks in 2020 for a staggering total of $7.5 billion, the move was met with a wave of dismissive reactions from analysts and gamers, signaling the beginning of an alarming series of acquisitions that would reshape the video gaming industry. This trend indeed continued with Sony acquiring Bungie for $3.6 billion in 2022. The alarm didn’t stop there, as Microsoft’s most recent and significant acquisition was that of Activision Blizzard for a grand total of $75.4 billion in October 2023, despite facing legal challenges for the move. This was followed by Microsoft laying off 1,900 employees from the mega studio, leading to the cancellation of numerous projects in the pipeline, proving the concerns of many analysts to be well-founded.
Continuing this trend, Microsoft has moved to close multiple studios of Bethesda Softworks, including Tango Gameworks (known for The Evil Within and Hi-Fi Rush), Arkane Austin (known for Redfall), Alpha Dog Studios, and Roundhouse Studios. This decision has resulted in the dreams of receiving more installments of many games from the Bethesda Softworks portfolio, which Microsoft themselves promote as “iconic,” to disappear along with these studios.
As reported by Bloomberg; Matt Booty, head of Xbox Game Studios, stated in an email to employees Tuesday that “These changes are grounded in prioritizing high-impact titles and further investing in Bethesda’s portfolio of blockbuster games and beloved worlds which you have nurtured over many decades.”
Although that doesn’t show us exactly how such a move would benefit gamers, Bethesda, and most importantly these studios, who will be hit by another wave of layoffs in line with what happened with Activision Blizzard, yet it definitely shows that Microsoft is feeling the impact of the slow expansion of their GamePass plan. They are reorganizing their strategy to make sense of the investment that exceeds $100 billion of aggressively acquiring different studios.
Funny enough, the move came after some of these studios, namely the Japanese developers Tango Gameworks, had released Hi-Fi Rush, the highest acclaimed games in Microsoft’s portfolio in recent years. The game now sits at 87% on Metacritic, surpassing even their biggest title under Bethesda, Starfield, which sits at 83% on Metacritic. Let’s not forget The Evil Within 2, which was one of the best horror games released by the studio or any studio at its time, only rivaled by Resident Evil 7 in the heavy horror games year of 2017. Given the fact that closing such talented video game makers will put these franchises on hold at best and never see them again at worst since Microsoft may focus on big Bethesda titles like Fallout as The Fallout franchise has recently received high acclaim due to a very successful TV show on Amazon Prime.
Microsoft recently started releasing their portfolio of games on PlayStation, starting with Hi-Fi Rush itself, along with Grounded and Sea of Thieves. This move signals their intention to test the waters of publishing their games on other platforms. Many analysts believe that PlayStation players will see more of Microsoft’s grand games, like Starfield, Gears of War, and Halo, coming to their shores. Who knows, given Microsoft’s focus on expanding the GamePass ideology, we may even see GamePass making its way onto PlayStation.
It is too early to see where Microsoft is heading with this, but all of this reminds me of when SEGA decided to leave the console market and become an IP company. Is this really what Microsoft is aiming to do? Only time can tell, for now it is just sad or rather concerning to see the video game indsutry losing so many talents and facing so many lay offs where it should be expanding given how every other company is announcing record revenue almost everywhere in the industry, especially Microsoft, which reported a 62% increase in Xbox content and services revenue in the past quarter.
