Microsoft Corp has spun off Bungie Studios, creator of the blockbuster Halo video game trilogy, but said on Friday it will maintain close ties with the company and own a minority stake in it.
Privately held Bungie LLC will develop games exclusively for Microsoft's Xbox 360 and Windows PC platforms "for the foreseeable future," Harold Ryan, Bungie's president and studio head, said in an interview.
The two companies said they would continue to work together to support the Halo franchise -- including Halo 3, which was released on Sept. 25 -- and expand their partnership to include new games. Executives declined to comment on the size of Microsoft's stake or other financial terms of the deal, which was effective from Friday.
PHOTO: AP
Microsoft acquired Chicago-based Bungie and its Halo concept in 2000, ensuring that the Xbox would be the only game console to run the multiplayer first-person shooter game. Bungie moved from Chicago to Kirkland, Washington, a few kilometers from Microsoft's Redmond headquarters, and the first installment of the trilogy went on sale simultaneously with the first Xbox console in November 2001.
"Working with Microsoft was great for us, it allowed us to grow as a team and make the ambitious, blockbuster games we all wanted to work on," Bungie founder and partner Jason Jones said in a statement on Friday. "But Bungie is like a shark. We have to keep moving to survive. We have to continually test ourselves, or we might as well be dolphins. Or manatees."
Matt Rosoff, an analyst for the independent research group Directions on Microsoft, said he doesn't think Microsoft wanted to spin off Bungie.
"This is probably about Bungie wanting to have a little more control over the kinds of games they're making, and not wanting to answer to Microsoft for everything," he said.
Ryan said Bungie had plenty of creative freedom while operating as part of Microsoft to build new game concepts and game prototypes.
But David Riley, a director at market researcher NPD Group, was skeptical.
"Even though they say they had plenty of creative juices flowing, [they] still can't act on them, not all of them anyway," he said. "There are limitations, and rules you need to abide by," when working inside a big corporation.
Gamers have plunked down more than US$300 million for Halo 3 since its release less than two weeks ago, and Microsoft said the game's launch goosed sales of the Xbox 360 console. The video game costs between US$60 and US$130, depending on special features and commemorative packaging.
About 4.5 million copies of the first Halo title were sold in the US, and more than 6.2 million of Halo 2, NPD Group said.
"While we are supporting Bungie's desire to return to its independent roots, we will continue to invest in our Halo entertainment property with Bungie and other partners," Shane Kim, corporate vice president of Microsoft Game Studios, said in a statement.
The company said it is working on a new project with film director Peter Jackson, of Lord of the Rings acclaim.
In an interview on Friday, Kim said that Microsoft had no plans to spin off other game studios owned by the software maker.
For the fiscal year that ended in June, Microsoft wrote down more than US$1 billion to cover widespread Xbox 360 defects, and reported an operating loss of more than US$1.89 billion for the division responsible for the game console.
The company has told Wall Street it expects the division to be profitable in the current fiscal year, and Kim said that thanks to the strong Halo 3 launch, "We're well on our way to achieving that objective."
Bungie's approximately 113 employees will remain in Kirkland.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
ARTIFICIAL INTELLIGENCE: The chipmaker last month raised its capital spending by 28 percent for this year to NT$32 billion from a previous estimate of NT$25 billion Contract chipmaker Powerchip Semiconductor Manufacturing Corp (力積電子) yesterday launched a new 12-inch fab, tapping into advanced chip-on-wafer-on-substrate (CoWoS) packaging technology to support rising demand for artificial intelligence (AI) devices. Powerchip is to offer interposers, one of three parts in CoWoS packaging technology, with shipments scheduled for the second half of this year, Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a fab inauguration ceremony in the Tongluo Science Park (銅鑼科學園區) in Miaoli County yesterday. “We are working with customers to supply CoWoS-related business, utilizing part of this new fab’s capacity,” Huang said, adding that Powerchip intended to bridge
Microsoft Corp yesterday said that it would create Thailand’s first data center region to boost cloud and artificial intelligence (AI) infrastructure, promising AI training to more than 100,000 people to develop tech. Bangkok is a key economic player in Southeast Asia, but it has lagged behind Indonesia and Singapore when it comes to the tech industry. Thailand has an “incredible opportunity to build a digital-first, AI-powered future,” Microsoft chairman and chief executive officer Satya Nadella said at an event in Bangkok. Data center regions are physical locations that store computing infrastructure, allowing secure and reliable access to cloud platforms. The global embrace of AI
Qualcomm Inc, the world’s biggest seller of smartphone processors, gave an upbeat forecast for sales and profit in the current period, suggesting demand for handsets is increasing after a two-year slump. Revenue in the three months ended in June will be US$8.8 billion to US$9.6 billion, the company said in a statement Wednesday. Excluding certain items, earnings will be US$2.15 to US$2.35 a share. Analysts had projected sales of US$9.08 billion and earnings of US$2.16 a share. The outlook signals that the smartphone market has begun to bounce back, tracking with Qualcomm’s forecast that demand would gradually recover this year. The San