I am glad this has been cleared up for us all.
Even though we had reports stating Microsoft was looking at acquiring EA earlier this year, at this point I don’t know if anyone was still expecting something like that to happen. Microsoft has purchased several mid-tier studios, and set up new ones, and more acquisitions are rumoured. It looks like the company’s strategy is to shore up its internal offerings by buying smaller developers, instead of buying mega-publishers.
Which is good news, because according to Morgan Stanley analyst Keith Weiss (via Business Insider), the economics of Microsoft purchasing a publisher like EA or Activision simply don’t check out, even if Microsoft would be looking at doing so to shore up Game Pass and become “the Netflix of gaming”. This ultimately comes down to the fact that purchasing either of those publishers would need to account for a lot of revenue streams that can’t be replicated post acquisition—such as deals with platform holders, or the money they get from FIFA selling approximately infinite copies by being on every platform.
“Bottom-line — the economics of driving a strong return from such an acquisition appear challenging,” Weiss wrote. “Microsoft would have to pay for revenue streams which couldn’t be replicated post acquisition.”
Which I get—and like I said, at this point I don’t know if anyone was actually expecting something like this to happen. Still, if you were, I guess now you know that a market analyst thinks it’s unlikely to happen.