Well the thing is MS so far only has Gears and Halo as their current cash cows, and they made 343 industries just for the purpose of getting as much as they can (milking) the Halo series.

Turn 10 will obviously support the racing needs and I thought they were rumored to make a new PGR in the future.

MS this generation has felt timed exclusives serve a better purpose and getting all the companies to go multi (like getting Tekken, Virtua Fighter, Devil May Cry and FF13 amongst other games.)

Wingnut is making an XBLA game. It's awesome looking ... and free :D

Fable also seems to be a good series for sales as both games have sold rather well.
If your going to own companies they need to pull in a profit to outside of just earning AAA ratings. Maybe after MS spent so much on Rare they thought buying companies wouldn't lead them to as much profit.

They cut off a whole bunch of studios not too long ago - The studio that did Flight Simulator, Esembles Studios (Age of Empires) and Bizare Creations (PGR series. Now doing Blur for activision) and years before that they dumped the studios that did Amped, Top Spin, Links, NHL Rivals and NFL Fever. I'm guessing all of them due to profit issues (Halo Wars was a great game, but I guess they were expecting gangbusters with Esemble behind the helm and the Halo name).

they do fine with 3rd party stuff and they have their few main first parties , i just dont think its in their best interest to focus so much on buying up companies and hoping for the best , its a gamble and they know they have more competition erupting from other sources besides the gaming market.

people may think they are flowing in cash but they have had their share of layoffs and apple isnt going away anytime soon and sony is pumping out game after game, also windows vista was a complete disgrace. realistically they need to focus on quality now more than ever before quantity.

Nothing in this world is free. And making a free game is entirely pointless because it will cost them money without the ability to recoup anything.

My bad... I was thinking of Big Park studios. -_-

But Joy Ride is free, and there are a couple of other free games on XBL also 

I wouldn't discount Rare, they haven't made any AAA games but they've made several solid titles. I think Rare though are the reason for MS being less than willing to buy new studios they spent a lot only to realise they bought a name and some IPs; I think they believe it's a better investment to pay third parties to produce games for them,

I mean MS got rid of Ensemble but if they ever want to make a new Age of, game they would probably get the former Ensemble guys to make it and it's probably better for them.

because you can't just say "I WANT TO BUY YOU" and think you can buy the entire world..

They got rid of Ensemble Studios, OddWorld , and Bizzarre Creations for that!!!!!

BAD MOVE INMO!!!!

MS only ever owned Ensemble out of all of those didn't they?

I'm pretty sure they just owned PGR and never Bizzarre