The most recent bout of FTC hearings have been an absolute nightmare for Microsoft. In a matter of days, a flood of what’s supposed to be confidential internal information has been exposed, divulging the inner workings of the tech behemoth and even revealing some of its ambitious acquisition plans.
Two days ago, some intriguing internal documents from Microsoft surfaced, shedding light on Xbox head Phil Spencer’s zealous plans to acquire Bungie and Sega, aiming to shore up the Xbox Game Pass offering. However, it seems Microsoft’s ambitions didn’t stop there.
Fresh documents revealed a project codenamed ‘Project Phoenix’ that involved Microsoft eyeing Square Enix for a potential acquisition. This move was seen as an opportunity for Microsoft to expand its presence in the lucrative Asian market, with iconic franchises like Final Fantasy, Dragon Quest, and Kingdom Hearts in their crosshairs for the then-upcoming Xbox Series X/S consoles.
But the story doesn’t end there. Project Phoenix had another objective in mind: to aid Microsoft in gaining ground in the competitive mobile market. By leveraging Square Enix’s “robust mobile-native portfolio”, Microsoft aimed to strengthen its “future mobile-exclusive Game Pass offerings.
At this point, the extent of Microsoft’s interest in acquiring Square Enix remains uncertain. According to one of the documents, Microsoft employed a thorough screening process to weed out studios that failed to meet its specific criteria.
The said criteria lists several factors including but not limited to a lack of expertise in original IP development, a tendency to follow rather than innovate, and a failure to align with Microsoft’s cultural values or display sufficient business maturity.
Sony and Nintendo’s dominance in the Asian market, specifically in Japan, is no secret. Microsoft has been determined to level the playing field for a while now, and Phil Spencer, in particular, has been vocal about his desire to acquire a Japanese game developer.
Alongside Square Enix, Microsoft had its eyes set on another acquisition that didn’t work out like Zynga. Unfortunately, they couldn’t seal the deal in time, and Take-Two Interactive swooped in, snatching up the American developer for a whopping $12.7 billion.
It’s yet to be decided whether Microsoft will be able to acquire Activision-Blizzard.
