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Vanversive said:
Seems like a stupid strategy to me. I prefer most 1st party games to 3rd party, unless its from konami, they have yet to let me down.

From a financial standpoint, it is a superior strategy.  Controlling the IP instead of creating IP allows for a much broader portfolio offering.  When something awesome comes along, they can secure exclusivity.  Plus they have kept the 2 studios most likely to create innovative and franchisable IPs, Rare and Lionhead.

 

MS employees are super expensive.  With publishing deals, no expense gets recorded until sales occur thus smoothing out earnings, which is a good thing for MS.