Microsoft's Bethesda Acquisition Reportedly Played Into Stadia Studio Closures

Microsoft's acquisition of Bethesda factored into Google's decision to shutter its internal Stadia game development studios, according to a Tuesday report by Kotaku.

Google Stadia vice president and general manager Phil Harrison pointed to Microsoft's aggressive acquisition strategy, and its planned purchase of Bethesda in particular, as factors leading to the closures during a Q&A with staff, per Kotaku's sources. Harrison did not explain why the acquisitions contributed to the Stadia studios' closures.

Microsoft announced plans to buy ZeniMax, the company that owns Bethesda Softworks among several other development studios, in September 2020. It launched a new subsidiary, Vault, Feb. 10 to merge with ZeniMax. The sale will likely close out later this year.

Harrison also cited difficulties posed by the COVID-19 pandemic and the "rising costs of game development," as reasons for the closures.

Developers at the studios were blindsided by the closure, as Harrison had sent an email to staff just a week before congratulating the teams on the "great progress" they had made thus far. In the Q&A, Harrison reportedly admitted to knowing the closures were coming when he sent that email.