I was thinking more along the tech side and what The Coalition could do, if they got even more closer to Epic.
I agree it wouldn’t add anything new to Xbox, but this would be a good investment for Microsoft.
Instead of owning them, why not just buy a major equity stake. Tim Sweeney still owns 50% of the company.
It’s hard to say. It’s obviously an appealing company to own for multiple reasons - Fortnite is still big, and it would give the owner an instantly commanding position in the engine market and put Microsoft in a position where they basically own game engine middleware entirely. If calculated by revenue, I believe UE would alone account for close to or in excess of 50% of the market.
This is more a medium term concern, but I am curious as to whether even Epic alone could eventually come under scrutiny for vertically integrating so many stages of the middleware engine pipeline in combination with their dominant market position in 3rd party engines licenses. The bundling is becoming increasingly hard to resist for licensees, the difference in development budget between engine companies is increasingly apparent, the pool of talented engine programmers is increasingly becoming absorbed by Epic primarily (this has been lamented by people in the industry actually). Former Crytek and Unity licensees are making the switch, although at least Unity remains popular with hobbyists and mobile developers.
If Microsoft did buy them, the synergies with gamestack and Xbox studios are huge and obvious but also possibly uncomfortable for some because of this. You’d have one company owning potentially all of the following, depending on the specific platform and developer in question and the exact combination of their needs:
- Cloud infrastructure (Azure)
- Hardware and/or operating system (Xbox, Windows)
- Graphics API (DirectX on Windows and Xbox)
- IDE (Visual Studio, which is already something you can hook up with UE)
- Code repositories (GitHub)
- Game Engine (Unreal Engine)
- Asset stores (Art Station, SketchFab, UE store, Quixel megascans library)
- Physics Engine (UE Chaos & Havok Physics)
- A shitload of other middleware solutions (Simplygon, Bink video, Oodle Compression, RealityCapture, 3 separate mocap solution services)
- Back end account services and crossplay solutions (PlayFab, Epic backend, Xbox backend)
- Anti-cheat solution (EAC)
- Store fronts for end-users (Xbox Store, Windows Store, Epic Games Store)
To say nothing of the more indirectly related products which many companies use - like Teams for communication or the rest of the office suite for all kinds of tasks.
Epic already bundles heavily in certain ways - for example, anyone using UE gets free access to middleware they would have to pay to use on other engines. They also get engine licensing payments waived for sales made on the Epic Games Store. The possibilities for further bundling and benefits to strengthen this whole ecosystem is immense and the kind of thing where I would expect the proposal to raise some eyebrows.
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Epic would be too much for MS, however with the looming fine Tencent is getting, now would be the time to do it.
The Chinese government is going to crush Tencent basically
I don’t think so, not to mention tencent owns 40% of epic and other companies like sony own a small amount of epic games granted sony owns like 1.4%. If epic/Tim Sweeney own more than 50% Microsoft could hypothetically by the controlling stack from him (hell they could technically buy stacks from sony or tencent) but I am not sure if they would be willing to sell, I don’t think epic is a great buy as all you would really get in terms of big stuff from them is the unreal engine or one of the biggest engines. I am speaking solely for MS gaming division by the way not MS as a whole
Let’s not get ahead of ourselves here, ms buying epic wouldn’t be good for anyone probably. I mean while they’re at it why not buy steam and sony as well? nintendo isn’t out of their reach either, they got the cash.
Don’t forget ms is a company, every move they’re making, they’re making to make profit, they’re not a charity, the fact that right now they are being a good value is because they practically almost killed themselves in gaming in the last gen, if it was the other way around, I’d bet ms would be pricing their games at 70$ right now and producing a gt7 like game.
Ms at this point, owns an absolutely massive chunk of developing power in the industry, I’m not against them buying up some more small studios that could use the help, and maybe one more not so big publisher, but nothing in the range of epic, in the long run that move, if it goes through won’t be in our best interest.
It won’t change much for a lot of people. Microsoft profits will be bigger though as Epic gets royalty from each UE game.
I am not sure that we need to concerns about “how bad Microsoft would become” considering that we have Sony and nobody bats an eye.
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It would leave a platform holder in control of what is a near industry standard and major component of games.
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Is it that different from Epic owning EGS on PC? Granted EGS is not that popular.
I think the concern is that a platform holder could cut UE off from its competitors.
Nobody bats an eye is a huge understatement. I personally was playing on playstation since ps2, series x is the second xbox I own since the original, and I won’t even bother getting a ps5 in the future.
Xbox came from a place of barely existing to being pretty healthy and growing, and I believe it’s not only the good moves ms is making, it’s also sony driving a lot of their fanbase away from their platform. But anyway this isn’t the thread for this discussion.
But it would not be that different from the concernt that Epic would cut off people from releasing UE games on Steam, no? I mean even now they provide some perks I believe if you use UE and release in EGS.
Maybe not you personally, but market enmasse is not that concerned. In fact I see more people surprised that Microsoft haven’t increased the game prices as of yet.
Yeah, I agree about that. Though for Microsoft gaming is much smaller priority than for Sony, so Microsoft is less likely to use draconian practices to increase their profits there. While Azure is doing good, they do not care about anything else. Sony on the other hand…
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We are in a weird place where pc gaming has become a luxury because of the gpu prices, and combining that with chip shortages, demand for consoles has exceeded supply by a lot, so yea the casual gamer than doesn’t get involved with sony’s practices doesn’t complain, but people are really getting riled up over gt7 especially, even hardcore fans that defended sony’s every move for years, they can’t keep doing what they’re doing indefinitely.
Even that I think is more online echo chambers rather than the general consumer. Still, we will see the sales numbers.
I think a key differentiator is that Epic built both of these and (UE at least) is a key business of there’s that has achieved dominance through normal competition.
I imagine Microsoft buying Epic is more like Nvidia buying Arm, in that it gives them control over industry standard technology in use by all of their competitors.
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Microsoft has historically not done many deals where they own minority stakes. They have done some over the years. However, unlike Tencent which mainly does minority stakes, it’s not a common deal type for Microsoft historically. Also, Microsoft is very comfortable having partners because of windows and their relationships with PC manufacturers. Working in a partnership with someone like epic would be well within the norm for them and would require no financial investment.
I’m not saying investing in Epic would be good or bad. Just it would be a bit out of the ordinary for them.
You don’t need to buy Epic to work closely with them on the engine. We just saw the announced collaboration with CD Project Red and Unreal Engine 5 a couple of days ago, which included working with them to make UE better for open world games.
Microsoft has had a long standing relationship with Unreal Engine and I wouldn’t be suprised if The Coalition was not already working extremely closely with Epic.
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Oh both Coalition and Ninja Theory definitely work closely with Epic. Coalition has a considerable number of former Epic engineers who also probably had input on UE previously, and wouldn’t be surprised if they still do.
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That is some heavily-reaching speculation about what Microsoft would do… despite having a myriad of evidence suggesting otherwise; Satya’s Microsoft and Phil’s Xbox are not the Microsoft from the 90s for crying out loud. Saying they would do the same things as Sony because “reasons” is not a viable argument.
Furthermore, at this point Microsoft doesn’t own Activision so the last point is moot. No one here is saying Microsoft should own all the big publishers or best developers, but pretending as though we don’t have evidence that Microsoft acquisitions have been good for all parties is counterintuitive; Microsoft’s benefit is obvious, gamers receive more value for Game Pass (and in some cases, Sony/Nintendo players are still able to access content), and every studio that’s been picked up thus far has been nothing but supportive of the move because of the funding, tech/expertise access, career mobility, and laissez faire dev environment. Perhaps leave the concern for when there’s evidence we should be concerned.
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It’s not out of bounds to buy Epic, their major focus on engine made it the most used in the market, which is why I wonder if XGS would not transition into a single engine like many studios do: Capcom was using MT Framework, then it was phasing towards Unreal Engine, but RE Engine was created along and it was really well done and became their sole engine. Bamco uses UE only and now they are doing their own engine. CDPR is moving to UE.
It’s fair enough that XGS uses multiple engines because “if it ain’t broken, don’t fix it”, but the reason why some publishers have one single engine is because its cheaper and easier to have technology sharing. EA was aiming that with Frostbite as it was the top of tier in visuals for many years (Battlefront 2 looks amazing to this day), but their management is awful as always and never gave time and resources for DICE to create a modular engine. XGS has now so many proprietary engines (ForzaTech, IdTech, IW Engine, Slipspace, Blizzard engines, Creation 2.0) that lets you wonder if they really gonna maintain Unreal for long.