Microsoft has expressed interest in acquiring Warner Bros. Interactive Entertainment, the gaming arm of the Warner conglomerate, according to a report published Monday, June 6. The potential transaction could bring several well-known development studios under the Xbox Game Studios umbrella.
Studios that could join Xbox Game Studios
If the deal proceeds, Microsoft could gain control of studios including NetherRealm, the developer behind the Mortal Kombat franchise; Rocksteady, known for the Batman Arkham series; and Monolith, the studio responsible for the Middle-earth games inspired by The Lord of the Rings.
Franchise ownership and licensing caveats
Sources indicate that not all intellectual properties tied to those studios would automatically transfer with the acquisition. While Mortal Kombat is reported as a primary IP included in the package, other franchises—particularly those that extend beyond games such as Batman and Harry Potter—might remain subject to separate licensing agreements rather than full ownership transfer.
Potential price and competing bidders
The transaction is estimated to fall in the $2 billion to $4 billion range and would likely involve a bidding process with other interested companies. Reportedly among potential competitors are Activision, Electronic Arts and Take-Two Interactive.
Strategic rationale for Microsoft
Acquiring Warner’s game studios would align with Microsoft’s recent strategy of expanding Xbox Game Studios through purchases. The company has added teams such as Double Fine Productions, Obsidian Entertainment, Playground Games and Ninja Theory to broaden its exclusive lineup after criticism that its offerings lag behind competitors.
Market implications
Making Mortal Kombat an Xbox exclusive would mirror prior platform-exclusive arrangements in the industry—such as Sony’s deal that made Street Fighter V a PlayStation 4 exclusive—and could provoke a stronger competitive response from rivals.
Background: why Warner might sell
Discussions about a potential sale of WB Interactive surfaced in June. Shareholders of AT&T, which acquired WarnerMedia in 2018 for more than $100 billion, have urged the company to reduce debt from that acquisition by selling noncore divisions. Despite these discussions, there has been no clear statement from AT&T indicating the interactive division is officially on the market.
