Industry defining: Xbox and Bethesda sitting in a tree, counting m-o-n-e-y

© Bethesda
In a landmark deal, Microsoft has now placed itself in a position not seen in decades. This is as huge as Rare leaving Ninty for Microsoft, or Activision scooping up Blizzard. Here's why...
By Kosta AndreadisPublished on
Mere hours before pre-orders would open globally for its next generation of consoles, the Xbox Series X and Xbox Series S, Microsoft dropped a Fallout-style Megaton - with news that it was acquiring Zenimax Media, the privately owned parent company of Bethesda for a cool $7.5 billion USD. Before the industry could even process that insane amount of money in historic terms, it had to digest the fact that The Elder Scrolls, Fallout, DOOM, Wolfenstein, The Evil Within, Dishonored, Prey, Quake, and other beloved franchises were now a part of the Xbox family.
This acquisition will also go down in history as one of the defining moments in the Xbox story...
From a pure studio count, the already formidable Xbox Game Studios - home of Rare, Obsidian, Turn 10, 343 Industries, The Coalition, Double Fine, and many more - would now grow to include Bethesda Game Studios, id Software, ZeniMax Online Studios, Arkane, MachineGames, Tango Gameworks, Alpha Dog, and Roundhouse Studios.
In simple terms, this is a massive stable, and perhaps the strongest across the landscape moving forward.
Bethesda is one of the largest developers and publishers in the industry, it employs over 2,300 people globally, with critically acclaimed titles like The Elder Scrolls V: Skyrim and DOOM Eternal earning their place in the videogame pantheon of all-time greats. In addition to being the biggest news to hit the industry in 2020, which is saying a lot, this acquisition will also go down in history as one of the defining moments in the Xbox story. A story that already includes Bethesda.
Alongside the announcement, head of Xbox Phil Spencer drew on the close relationship Microsoft has had with Bethesda dating back decades. From the very first DOOM running on the MS-DOS platform to working with Bethesda to bring large open-world RPGs to console players en masse with The Elder Scrolls III: Morrowind for the original Xbox.
“Like us, Bethesda are passionate believers in building a diverse array of creative experiences, in exploring new game franchises, and in telling stories in bold ways,” Phil Spencer wrote in his post surrounding the deal. “All of their great work will of course continue and grow and we look forward to empowering them with the resources and support of Microsoft to scale their creative visions to more players in new ways for you.”
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He jokingly quipped that the moment felt like an Xbox-style Achievement unlocking...
A sentiment shared by Todd Howard, the head of Bethesda Game Studios and longtime fan of the Xbox platform. After he received a Lifetime Achievement Award at GDC back in 2016, he jokingly quipped that the moment felt like an Xbox-style Achievement unlocking. In response the Xbox team created a game assigned specifically to Todd’s Xbox account, where firing it up unlocked a special achievement worth 1000 points.
“With each new console cycle, we evolved together,” Todd Howard writes. “From bringing mods to consoles with Fallout 4, now over a billion downloads, to the latest technologies fuelling Xbox Series X/S. These new systems are optimised for the vast worlds we love to create, with generational leaps not just in graphics, but CPU and data streaming as well.”
Following the announcement, Bethesda’s global head of marketing and face seen at various E3-style presentations, Pete Hines, also reaffirmed that the acquisition builds on a shared history. “It’s a big change for us, but after taking a minute to absorb the magnitude of this acquisition, we’re going to continue doing what we know and love: making great games,” Hines said. “We’re going to keep trying new things. We’re going to take the same passion we’ve poured into what we do, and the passion that our community brings to the things we make, and do even better.”
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The Multi-Platform Question

We’re now living in a world where Microsoft is set to publish exclusives on a competing console...
As part of his response Bethesda’s Pete Hines also stated that games currently in development are still in development. And that Bethesda will publish these titles in the future. The first two that come to mind on that front include Arkane’s Deathloop and Tango’s Ghostwire: Tokyo, both timed exclusives for the PlayStation 5. Which is a weird state of affairs, we’re now living in a world where Microsoft is set to publish exclusives on a competing console.
The real question surrounding this massive acquisition, what does it mean for Xbox and for the future of Bethesda as a third-party publisher? Will Bethesda Game Studios’ follow-up to Fallout 4, the sci-fi epic Starfield, become an Xbox exclusive across PC and Xbox Series X | S and skip PlayStation entirely? Time will tell, though Microsoft has stated that potential platforms will be assessed on a case-by-case basis. Which could mean anything really.
But taking a look at both companies and their products and platforms we begin to see the bigger picture. One with immediate short term benefits, and another that presents a long-term strategy and goal that Microsoft is building towards. One free from the high-end console as the sole platform.

Xbox Game Pass, Where The Service is the Platform

At face value one could look at this deal as a means to drive interest in the Xbox Series X -- a console that impresses in terms of raw power but still feels lacking in the game department. Compared to Sony, there’s currently no God of War or Horizon Zero Dawn equivalent announced for the Xbox Series X. The platform’s two biggest prospects, Fable and Halo Infinite, haven’t quite reached the same levels of player anticipation as Sony’s first-party stable. Fable on the account of it not being in a state to show gameplay, with Halo Infinite’s debut failing to meet the visual expectations of players when it comes to a major next-gen debut.
Microsoft is presenting the future of Xbox as a vision that looks in both directions...
Even with the powerful Xbox Series X, which will support cutting-edge hardware that will all-but eliminate loading times and present new visual techniques like real-time ray-tracing, Microsoft is presenting the future of Xbox as a vision that looks in both directions.
From supporting the entire Xbox One library and titles from the Xbox 360 and original Xbox on the Series X, through to introducing Game Streaming via the cloud for hundreds of Xbox titles on Android devices. The glue that holds this vision together, including the hardware, is Xbox Game Pass. Where for a monthly fee players can download or stream all first-party Xbox Game Studios titles from the past and present -- with new releases appearing on the service day and date.
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With the arrival of Bethesda into the fold, the already stellar value associated with Xbox Game Pass on PC and console effectively doubles. DOOM Eternal, The Elder Scrolls series as a whole, Prey, Quake III Arena, even something like Commander Keen -- Xbox Game Pass will not only feature new games like Starfield at launch but the entire Bethesda catalogue.
Even if Starfield debuts on the PlayStation 5 at a full retail price point, this gamer-focused approach is commendable and an asset to the Xbox brand. As aggressive as the move to purchase Bethesda can seem, it could boil down to a value proposition too good to ignore. Fast forward a few years and the traditional route where you purchase a single title may seem quaint when you can subscribe to Xbox Game Pass and get Starfield and the entire Bethesda catalogue to play when you want and on what platform suits you best -- console, desktop PC, gaming laptop, tablet, or smart-phone. Bethesda, who’s Orion technology is all about streaming, shares a similar vision.

A Future Full of Blockbuster Releases

With Deathloop and Ghostwire: Tokyo being timed-exclusives for the PlayStation 5, this represents an immediate hurdle on an otherwise smooth road towards a bigger and broader future for Xbox and Bethesda. In terms of scale, a mere blip on the radar. The Elder Scrolls Online and Fallout 76 have millions of players across a range of platforms, and no doubt the teams at Zenimax and Bethesda will continue to support the player base for years.
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A story that tracks with the past few years of Xbox Game Studios growth, where teams are left to continue to work as they see fit but with the full backing of Microsoft. Will we see Bethesda games slowly favour the Xbox platform over the competition? Sure, but Microsoft’s commitment to PC and Game Streaming over Android devices represents the antithesis of a closed community.
As an investment it doesn’t make long-term sense for Microsoft to don a console war mentality, to put forth a Xbox Series X-sized barrier for those looking to play The Elder Scrolls VI. All things being equal and if anything is possible, odds are Microsoft would look into bringing Xbox Game Pass to both the PlayStation 5 and Nintendo Switch. The Netflix model is one that is dependent on subscribers, and with Xbox Game Pass recently passing 15 million it’s well on the road to becoming a similar juggernaut. With Bethesda a part of Xbox moving forward, it’s hard to see how a competing service could remotely match the sheer value on offer to gamers when it comes to Xbox.
And on that note we’ll leave the final word to Todd Howard, who’s currently leading the Bethesda Game Studios team on its most ambitious project to date -- the sci-fi RPG Starfield. The studio’s first new IP in generations and the follow up to both Skyrim and Fallout 4.
“Like our original partnership, this one is about more than one system or one screen,” Todd Howard writes. “We share a deep belief in the fundamental power of games, in their ability to connect, empower, and bring joy. And a belief we should bring that to everyone -- regardless of who you are, where you live, or what you play on. Regardless of the screen size, the controller, or your ability to even use one.”
Starfield may debut on Xbox Series X and PC, and that could even extend to PlayStation 5 -- but with streaming it will also open the door to a billion devices ready to reach for the stars.
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