Microsoft considered acquiring Sega, Bungie, and more to boost Xbox content

Microsoft might have its sights set on Activision now, but it’s been revealed that the company previously thought about acquiring a number of different game developers instead, including Sega and Bungie.

Lots of spicy information about Microsoft, Xbox and the games industry in general has been revealed over the course of the last year, thanks to the ongoing scrutiny of the proposed Activision buyout. Regulators have been trying to determine whether or not the acquisition going through would give Microsoft an unfair market advantage, and given that the UK’s Competition and Markets Authority (CMA) blocked the deal earlier this year, and the U.S.’ Federal Trade Commission (FTC) more recently sought to file a temporary restraining order and preliminary injunction, things haven’t been going brilliantly for the company.

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In the last week, Microsoft has been in court battling against the FTC in an attempt to justify the Activision acquisition’s fairness, and an interesting document has surfaced as evidence in the trial. As reported by IGN, the document reveals Microsoft’s acquisition strategy as of May 2021, about eight months before the proposed Activision buyout was announced. Looking at it, it seems to imply that Microsoft had initially thought of a whopping 100 developers that it’d considered acquiring in order to fill content gaps (in particular, gaps in "franchises with strong communities and deep engagement" and "casual, social, and cross-generational franchises"). The top eight included Sega, Bungie, Supergiant Games, IO Interactive and Niantic.

Furthermore, it sounds like Xbox boss Phil Spencer was particularly interested in Sega, as an email dating back to November 2020 shows that he approached both Microsoft chief financial officer Amy Hood and CEO Satya Nadella in order to request approval to approach the company and potentially acquire its gaming studios. In the email, he stated: “We believe that Sega has built a well-balanced portfolio of games across segments with global geographic appeal, and will help us accelerate Xbox Game Pass both on and off-console.”

Last year, Sony officially acquired Bungie, so Microsoft almost certainly isn’t going to be buying that any time soon. As for the rest of the document, it's not clear if Microsoft might still be interested in any of the developers listed - I suppose everyone's a bit busy trying to deal with the Activision buyout for now.