Microsoft's Bungie to Be Split Off

Microsoft Corp. said the group behind its hit Halo videogame series will become an independent company, marking another in a series of setbacks for the software maker's entertainment group even as it celebrates extraordinary sales of the latest Halo game.

Microsoft said Friday that it will split off Bungie Studios, retaining an equity stake in the company. Bungie, which Microsoft purchased in June 2000 in a deal analysts valued at $20 million to $40 million, will operate independently and will be allowed to make games for game machines other than Microsoft's Xbox 360 console, the companies said.

While Bungie was the creative force behind the Halo trilogy, Microsoft retains the rights to the Halo franchise and can use other studios to build Halo-related games.

The split comes a week after Microsoft began selling Halo 3, the third and last installment of the series. Microsoft said that it had posted more than $300 million in sales of Halo 3, making it one of the most successful videogames ever.

Executives at Microsoft and Bungie didn't disclose details of the split, saying only that it was based on the desire of game makers at Bungie to operate independently. "This is not a divorce," said Shan Kim, the Microsoft vice president who heads the company's game development. "This is the best way for us to pursue a long-term relationship with Bungie."


source: The Wall Street Journal