Bioware was too expensive. Look at how much EA spent to acquire them.
Bizare was their worst decision in terms of letting people go because they made great games that sold well. Geomtry Wars XBLA anyone? PGR4 was heavily bundled but still sold decently. The only thing I could think of why MS would release them was because of Turn 10 - they only had room for one racing studio.
I think 343 Studios will do fine replacing Bungie. Halo Reach is a great game but It's not like Bungie has exactly turned the wheel with the Halo series. 343 can do the same thing with the future Halo games - just add a bit more and polish it as much as you can.
It's just that simple.







