Microsoft Spins Off "Halo" Creators

Microsoft Corp. confirmed that it will spin off Bungie Studios, developer of the "Halo 3" video game that recently set records for opening day sales.

Microsoft will retain an undisclosed equity interest in Bungie. The announcement, made Friday, follows a post on the 8BitJoystick blogfrom earlier this week that leaked the news.

Practically speaking, not much will change, said Frank O'Connor, writing lead at Bungie. While he said that the move is "fiscally prudent" for Bungie because it will get a better share of profits, the company will continue to work closely with Microsoft on developing games for the Xbox console.

He left open the answer to a burning question from fans of other gaming platforms: Will Bungie write games for non-Xbox consoles? "In theory, yes," he said. But for a while the relatively small staff of 120 will continue to work on Xbox 360 games, he said. Projects for the midterm are already lined up and they're all based on the Microsoft console, he said.

"Honestly, we're really happy working on the 360," he said. "It's our platform of choice."

Bungie was once an independent company. Not quite 10 years ago it was acquired by Take 2 Interactive Software Inc. Later, Microsoft took a share in Bungie and then bought it outright.

Microsoft owns the intellectual property for "Halo," a series that just released its third and final game. "Halo 3" brought in sales of US$170 million in the U.S. the first day it became available. Microsoft says that's the best video game and entertainment launch in history. "Halo 3" sales reached $300 million globally on the first weekend.