In early August, Xbox CEO Asha Sharma outlined a multiyear plan to return Microsoft’s gaming division to player and revenue growth. One of its four priorities, described as “Connection,” involves expanding Xbox properties into movies, television, consumer products, sponsorships, and live experiences. Now, Xbox appears to be putting that strategy into action.
According to Puck, Microsoft is shopping some of Xbox’s largest franchises to Hollywood as part of a massive licensing package that could produce numerous movies and television shows. The proposed bundle reportedly contains more than a dozen video game properties, including Halo, World of Warcraft, The Elder Scrolls, and Diablo. Microsoft wants a single studio or streaming service to secure the package through a long-term agreement.
Asha Sharma at Microsoft Ignite 2024 – Microsoft Events, YouTube
Netflix, Paramount, and Universal are reportedly examining the proposal. However, none of the companies would comment on the negotiations.
Microsoft is seeking more than $300 million for the package. That asking price has already caused at least one unspecified potential partner to hesitate.
The agreement would license adaptation rights rather than transfer ownership of the franchises. Microsoft would continue controlling the properties, while the successful bidder would presumably bear the cost of developing and marketing movies and television shows based on them.
Microsoft Has Amassed a Massive IP Catalog
Over the years, Microsoft has acquired a considerable collection of valuable properties.
The company’s $68.7 billion acquisition of Activision Blizzard in 2023 added Call of Duty, World of Warcraft, Diablo, Overwatch, and numerous other franchises to an already extensive catalog that included Halo, Gears of War, and Forza.
Its earlier acquisition of Bethesda parent company ZeniMax Media also gave Microsoft control of The Elder Scrolls, Fallout, Doom, and Wolfenstein.
However, several of those franchises are already committed to other Hollywood partners. Warner Bros. and Legendary Entertainment produced A Minecraft Movie, while Amazon MGM Studios developed its successful Fallout series.
Walton Goggins (The Ghoul) in “Fallout” – Licensed, Amazon MGM Studios
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Netflix is developing a live-action Gears of War movie and an animated Minecraft series. Paramount is also producing a Call of Duty movie from writer Taylor Sheridan and director Peter Berg, which will be set in the Modern Warfare universe.
The rights to Halo have reportedly reverted to Microsoft after Paramount+ canceled its television adaptation following two seasons. Despite its considerable budget, the series faced frequent criticism for departing from the games and mishandling Master Chief.
Universal previously released a Warcraft movie in 2016. Although it earned nearly $440 million worldwide, poor domestic ticket sales and negative reviews prevented it from launching the planned film franchise.
Xbox Looks Beyond Games for Growth
The Hollywood pitch comes as Xbox attempts to recover from declining revenue, layoffs, and years of strategic uncertainty.
Microsoft recently reported that Xbox revenue fell 10 percent year over year. Content and services revenue also declined 10 percent, while hardware revenue dropped 13 percent.
A $300 million licensing agreement would advance Sharma’s “Connection” strategy while providing Microsoft with a significant influx of cash. However, placing so many valuable franchises with one entertainment company would also carry considerable creative and financial risks for both parties.
A screenshot from The Elder Scrolls Online (2014), ZeniMax Online Studios
Microsoft has already experienced both sides of video game adaptation. Fallout and A Minecraft Movie became major successes, while Halo failed to satisfy many longtime fans. The licensing partner would also likely need to provide massive production budgets to adapt fantasy properties such as The Elder Scrolls and Warcraft. Although video game movies are generally performing well, there is no guarantee that every project will connect with audiences.
The proposed package could transform Xbox into one of Hollywood’s most important suppliers of intellectual property. First, Microsoft must convince a partner that access to its vast gaming catalog is worth the enormous price.
Do you think there will be new film and television adaptations of Xbox properties? Sound off and let us know!
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