Netflix offered Microsoft around $500 million for exclusive rights to turn Xbox games into shows and movies over seven years, according to a Puck report published October 23 that cites three sources. Xbox came back asking for $800 million, and the deal fell apart, as VGC and Inven Global report.
In an unsigned statement to Puck, Xbox neither confirmed nor denied those figures. It said it has "received record-breaking interest in our I.P.," called Netflix a valued partner, and pointed to the Minecraft and Diablo animated series the two companies are making together, among other adaptations. Netflix declined to comment, Pure Xbox notes.
How the deal collapsed
Puck says the offer came from Bela Bajaria, then Netflix's chief content officer. Negotiating for Xbox were CEO Asha Sharma and its business affairs team, which made the $800 million counter. Netflix took its offer off the table after Bajaria's exit, which the streamer announced on October 15 alongside roughly 1,000 layoffs. Netflix CFO Spence Neumann was among the executives who thought the price was too high.
Spread over seven years, Netflix's bid works out to about $71 million a year, while Xbox wanted about $114 million a year. According to Puck, Xbox is now chasing smaller deals with more partners instead of handing its franchises to a single streamer. Bajaria's replacement, former Disney and Fox executive Peter Rice, starts October 26 and is expected to pursue more licensing deals like this one, Inven Global reports.
Which franchises could be involved
The October report doesn't say which games the license would have covered. The closest clue is an earlier Puck item from late August, summarized by What's on Netflix. At that point Xbox was shopping a package of more than a dozen franchises, including Halo, World of Warcraft, The Elder Scrolls and Diablo, to Netflix, Paramount and Universal, and asking more than $300 million for a long-term deal. Nothing confirms it was the same package Netflix bid on, so the August ask of more than $300 million can't be compared directly with Netflix's $500 million offer.
Xbox adaptations already in the works
Netflix already has one of Xbox's best-known franchises in development. In November 2022 it announced a live-action Gears of War movie along with an adult animated series. David Leitch, known for the John Wick films, is attached to direct, and the latest known draft of the script comes from Dune co-writer Jon Spaihts. Leitch said in April that Netflix is fully behind the film, but there is still no cast or release date, and his producing partner has ruled out a 2026 premiere, per GameSpot.
Both animated series mentioned in the Xbox statement are Netflix projects too. The Minecraft show was announced in May 2024 with animation studio WildBrain, and the Diablo series was revealed at BlizzCon this September, PC Gamer reported. Neither has a premiere date.
Xbox's two biggest live-action shows landed elsewhere. Paramount+ made two seasons of Halo before canceling it in July 2024, and What's on Netflix reports that the screen rights have since gone back to Xbox. Fallout lives on Amazon's Prime Video. Its second season finished airing in February and production on season three began in May, with no premiere date yet, according to SlashFilm. In other words, Xbox already spreads its franchises across several streamers, which is the approach Puck says it now prefers.
Why it fits Xbox's cost-cutting
The talks overlap with a deep restructuring at Xbox. Fortune reports, as summarized by Push Square, that Xbox has cut 1,868 jobs out of a planned 3,200, with more rounds expected this month, in November and in January. We covered that report alongside Xbox's à la carte Game Pass plans. This week, French press reports said Microsoft will close Arkane Lyon, the studio behind Marvel's Blade, if it can't find a buyer, as Pure Xbox relays. Microsoft says it is still looking for a partner for the project.
Licensing a franchise to Hollywood brings in money without the cost of building a game, and Kotaku reports that Gears of War: E-Day alone cost more than $500 million. Xbox set up that side of the business in early October, when it created XP, a division for film, TV and merchandise built around its franchises. The $800 million ask and the shift toward several smaller deals suggest Xbox expects to earn more by licensing its worlds piece by piece than by selling them as a bundle. Neither Xbox nor Puck has said which partners or franchises those deals will involve.
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