Getting stronger 1st party would make sense, with 3rd party MS can use its huge cash to shop around, but to do it effectively, good projects, and appealing to XB360 audience too, must first exist. And MS built its biggest gaming success since Flight Simulator, Halo, in a studio it controlled and owned too for years, and it still owns Halo rights, total control allowed the best synergies possible between HW and SW.
It would be a good thing for users too, MS using its money to do things that sell well because they are good, not because money was used to crush competition. I'm not a Halo fan (I like most of it, but I don't like its controls, I don't like gamepads for shooters in general), but I admit it's very good, and it's a good example of what good MS can do if it wants. OTOH, MSDOS crushing DRDOS, Windows crushing OS/2 (and also all not x86 based systems of those times except the mac) already when mainstream Windows versions still were utter shit, Office crushing WordPerfect and Smartsuite, IE crushing Netscape and so on, are all good examples of MS doing the worst products and still winning, against people's interest.
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