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it is quite possible for Microsoft to spin off their games division and sell it to say... EA? Then they could stay in the Software market and still make games for PC and Xbox. MS would no longer have the liability of unsold stock or warranty issues. They would just collect money as if they were any other game developer.

If EA were to get into the game, why start from scratch when you already have an existing brandname?

They could keep Xbox Moniker and everything too. The EA Xbox. Doesn't sound too bad, does it?