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Great post!

MS definitely made the right strategic decision to cut development head count.  Both the ensamble and bungie situations worked out great for everyone - gamers, developers, and MS.  The only people hurt by those moves were the dead weight at ensemble.  From MS' standpoint, they could to have their cake and eat it too.  Game output stayed the same and their financials improved greatly.  I don't think most people appreciate how much emplolyees cost.  An entry level developer probably costs MS at least $125,000 a year or something, only a 1/2 of which is salary and taxes.