I don't know if you would say it's good for the PS3... URE3 generally runs better on the 360 

Thats not my point. My point is to show that its senseless from a buisness standpoint to buy Epic if you are a console manufacturer because the ability to develop a Multiplat Engine is the biggest reason why Epic is so succesful. MS knows that and Sony also. I bet MS wont buy them maybe if Sony wouldnt play a big role so most games would be exclusive for Xbox anyway. But in this situation its just stupid to do that. If you subtract all games which have UE3 and are for PS3 and Xbox360 there wont be much left. I couldnt name you one except Gears of war.

To your question:

I wanted a new leader engine for atleast one year, because I think UE3 is outdated. Hopefully Cryengine 3 will deliever and take over the market.

Yeah, I was also wondering what kind of contracts Epic has.  For all we know it has contracts the go out 2 or 3 years for games currently in development to support the engine.  That would be a real legal mess for MS to accomodate.

MS could just buy Epic and accept that it has to honour inherited commitments, but that would be a pretty annoying situation for MS.  I'd say they'd rather simply contract with Epic for stuff that is exclusive.

One thing that struck me about this, is that if the number of independants like Epic dwindle, it could leave MS exposed with their current strategy for getting exclusives via third parties.  If almost everything ends up under an Activision or an EA MS is either going to have to accept building up a much bigger first party support infrastructure or face finding it much harder to secure exclusives for the platform.

I mean, I guess in principle they could contract with EA for an exclusive, but that would seem a lot more unlikely that contracting with Remedy or Epic or Bioware.

If I was MS, and I'm sure they're smart enough to be watching this already, I'd be considering my options for some careful purchases if it looks like too many developers are going to end up absorbed by multiplatform focused publishers.  For example if Alan Wake is a hit I'd buy Remedy for sure if I was MS.  Epic does seem tempting, too, but I think for MS the potential number of contractural commitments they may (and remember I'm only guessing at their nature) could make that a tricky proposition in real life.  Heck, if there are enough Unreal Engine based multi-platform titles out there there could be an arguement for anti-trust with an Epic purchase.

i don't know if you guys have noticed but MS strategy is not focusing on first party at all.(for god sake they didn't purchase bungie)

now as for Epic,epic games without a multi-plat engine does not make sense financially.

also MS has some of the best dev kit/tools creators .so they won't need epic to make a dev kit for them for their future consoles. so it does not make any sense at all.

After the Bioware buy-out, I'm sure M$ isn't going to be keen on anybody buying out Epic.  There would be far too much of a threat to one of their major franchise, and honestly, I think 2010 shows that M$ is strenghing it's ability to produce content.  Yes, EA has a multi-platform stance, but M$ can still simply contract out the development duties to 3rd party on IPs that they create. 

Microsoft would probably have a tough time buying Epic because of the Unreal Engine. Regulators would probably look at it as a monopoly move...

Also, Microsoft is obviously thinking that 1st party developers is not a good long term strategy. I am not sure why, but there have been some real obvious opportunities for first party purchases that they have simply passed up... Midway, Bioware, Pandemic, etc.

Monopoly?  In what way?  M$ IS the smallest developer amongst it's competitors and Unreal is one of many choices on the market?  Who exactly would pursue this case, and on what technical grounds...hmmm...after the bullshit fines EU has placed on US companies...maybe they might.

You think they would be fine with the Unreal engine being used in just about everything.

I think if Microsoft bought them they wouldn't stop the Unreal Engine being used on multiplat games. I think it'd be more likely for them to offer two different rates, say 10% if you make an xbox exclusive, 25% if it's multiplat. That way they could possibly secure more exclusives from third parties without paying and still have the unreal 3 engine used as one of the main multiplatform game engines

I'll LOL so hard if sony sneaks in and buys them :P