Why acquiring Electronic Arts (EA) could be a great deal for Xbox and Microsoft

EA and Xbox make for an unlikely pair that not many could have pictured at the start of the year. A potential deal can't be ruled out based on how things are progressing, especially if the recent rumors are to be believed. As per the latest news, it appears that EA is looking for potential parties who would be interested in buying them out. Microsoft's gaming division will rise as a natural suitor given the potential cost and scope.

Established in the 1980s, EA has become a global gaming giant, with the company establishing several franchises over the years. As per the latest leaks, there have been talks about the company merging with NBC. While that deal might not have materialized, Xbox could now become an unlikely suitor.

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Xbox acquiring EA could benefit both parties immensely

Despite their success over the last few decades, recent times have been hard for EA. While their games seem to sell well, there are many question marks regarding the quality of their titles.

There are plenty of controversies related to the company that involves the promotion of loot box mechanics and other practices. Fans have also protested against the company for locking content behind paywalls.

The acquisition by Xbox will solve several problems that CEO Andrew Wilson currently faces, and cash won't be an issue for Microsoft, which recently acquired Activision Blizzard.

EA's focus in recent years has been on live service. While EA Play is available on the Game Pass, it will be quite different if it becomes a part of the Xbox ecosystem. All new releases will be available openly on day one as part of the service. While they will lose the game's purchase price, it opens their releases to a much larger audience.

The inclusion of all EA games will also do a world of good for the Xbox Game Pass. Phil Spencer has been quite vocal about his and Microsoft's ambitions for the revolutionary service. Getting games like the future Battlefield, FIFA, or Madden could be quite interesting for any potential customer who wants to sign up for the service.

It's not just live-service games where a deal could benefit the two. Any acquisition requires an evaluation of what's on offer for the buyers. As for Xbox, EA's games are quite different from what its first-party studios are making.

Of course, Microsoft could also look to get a potential partnership with Electronic Arts, but acquiring it offers the parent company greater freedom. It's quite likely that Andrew Wilson will want to remain in charge, and it's unclear what kind of policy Phil Spencer would like to follow. Once the Activision Blizzard deal is done, the hierarchy will become clear. However, Microsoft seems to offer a lot of autonomy to the studios and publishers.

EA is also a company with a higher valuation than most studios and publishers. Given its list of live-service games, any buyer could potentially profit a lot from an acquisition. The proposition also makes it ideal for Microsoft as they can cut down the competition. It will be interesting to see what the future holds for the two companies.