It was just a little over a year ago when Microsoft’s list of first party game development studios was alarmingly short. It is no exaggeration to say that you could have counted the vast majority of first party Xbox studios on one hand. Fast forward to the 2018 Xbox E3 press conference when Microsoft’s Vice President of Gaming – Phil Spencer – took to the stage and stunned the world by announcing five new additions to Xbox Game Studios. Four of those studios would be acquisitions while the last one would be built from the ground up. In November we learned that Microsoft had acquired Obsidian Entertainment and inXile Entertainment and this news would be followed up this year with the acquisition of Double Fine Productions and the creation of a studio to manage the Age of Empires franchise. That is a total of eight studios that were acquired or created within the span of a single year. To put it bluntly, that is an unprecedented development in the history of this industry.

And Microsoft may not be finished yet.

[W]e’re not spending $12 billion on video games today, but as the subscriptions grow and reach more customers, I do think it’s important for us to continue to invest in content. It’s not every year that we’ll add seven new studios, but I do think us looking at specific targets that we need is important,” said Spencer.

Ever since the days of the original Xbox Microsoft has had difficulty selling their consoles in Japan and at least part of that is due to the company’s lack of studios in that country. Fortunately, Phil Spencer is perfectly willing to explore the possibility of a Japanese studio joining the Xbox family. “I think it would be nice if we found an Asian studio, in particular a Japanese studio, to add [to Xbox game Studios],” said Spencer while taking with Game Informer. “I liked it when we had some first-party capability in Japan. We have a small team there, but I think we can do more.”

There is a popular misconception that it is illegal for an American corporation to acquire a Japanese company. That is not actually true. For example, Walmart owns a majority stake in Seiyu, one of the largest supermarket chains in Japan. For Microsoft to acquire a Japanese studio the tech giant would have to establish a subsidiary to operate in Japan and that step has already been taken – there are both Microsoft and Xbox teams already working in that nation.

That is not to say that there will be such an acquisition any time soon. The current approach of the Xbox team seems to favor slowly building up working relationships between these companies and experience their internal cultures firsthand. If such an acquisition were to happen then The Inner Circle will most definitely be here to tell you all about it.