Microsoft buys four game studios including Playground and Ninja Theory, sets up a fifth

Microsoft buys four game studios including Playground and Ninja Theory, sets up a fifth

Microsoft has doubled its first-party development portfolio with a series of acquisitions and investments.

The PC and console giant has bought four developers and set up a fifth, called The Initiative, in California's Santa Monica.

Per rumours last week, Forza Horizon developer Playground is officially joining the Microsoft line-up of studios having worked almost exclusively for the company in recent years. In addition to that racing franchise, Microsoft also has the game maker working on a new project that uses its open-world knowledge. It's likely this is the Fable game reported on earlier in the year.

Hellblade maker Ninja Theory has also joined Microsoft Studios. The platform holder says it will be ensuring the Cambridge-based game studio will have "the resources and freedom" to make ambitious games like last year's Hellblade.

Undead Labs, the developer behind the State of Decay franchise, has also been bought by Microsoft. This, the company says, is an indication of the commitment it is making to the franchise. The latest entry gathered two million players in its first two weeks on sale.

And the last acquisition on the books is Compulsion Games, the developer behind Compulsion Games. This deal hasn't gone through, with Microsoft simply entering a letter of intent to the Canadian studio, but it's not likely they're going to say no given it was announced on stage at E3.

“The original games we create at Microsoft Studios are some of our biggest assets,” recently promoted corporate vice president of Microsoft Studios Matt Booty said.

"Our growth strategy is to continue to expand the worlds that players love, while developing all-new exclusive games that deepen their engagement with our platform. We are thrilled to welcome five new studios into the Microsoft family. We believe these teams have the collective creative power and operational excellence to deliver the next industry game changers.”

This represents a substantial investment in development talent and shows Microsoft ramping up game production before the launch of the next console generation. Head of games Phil Spencer said yesterday that such a device is in development - likely getting its foot in the door ahead of PlayStation.

You can check out all the news from Microsoft's conference right here

PCGamesInsider Contributing Editor

Alex Calvin is a freelance journalist who writes about the business of games. He started out at UK trade paper MCV in 2013 and left as deputy editor over three years later. In June 2017, he joined Steel Media as the editor for new site In October 2019 he left this full-time position at the company but still contributes to the site on a daily basis. He has also written for, VGC, Games London, The Observer/Guardian and Esquire UK.