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Rumor: Microsoft is close to buying Obsidian Entertainment

Microsoft is reportedly close to finalizing a deal to purchase indie RPG developer Obsidian Entertainment based on three anonymous sources who spoke to Kotaku. While these deals sometimes fall apart at the last minute, one source told Kotaku that it was merely "a matter of when, not if." Another source said the deal was "90 percent" finished.

If this deal goes through, it would be a huge change for Obsidian Entertainment who has remained independent for 15 years while developing beloved RPGs like Knights of the Old Republic 2, Fallout: New Vegas, and the more recent Pillars of Eternity series. Fans of Obsidian will know that Pillars of Eternity, which was funded through Kickstarter in 2012, saved the company from a financial crisis that saw it almost go out of business. Obsidian was able to repeat that success with Pillars of Eternity 2, making it the biggest crowdfunding success since 2015.

Despite the success of Obsidian's recent games, being independent in this climate is a hard sell for a company with well over a hundred employees. In the last year, 10 studios have gone out of business, so it makes sense why Obsidian would seek the financial security of Microsoft.

What's interesting, though, is that Microsoft is the reason Obsidian Entertainment almost closed its doors in the first place. The two were working together on an Xbox One exclusive called Stormlands that Microsoft canned in 2012, forcing Obsidian to gamble on Kickstarter to raise the money for Pillars of Eternity. That was a long time ago, however, and Microsoft's Xbox division is now under new leadership.

This deal also makes sense for Microsoft, which has been on a buying spree over the last year with the purchase of four studios including Hellblade developer Ninja Theory and Forza Horizon 4 developer Playground. As sources told Kotaku, Microsoft has been looking to expand its PC audience—and what's more at home on PC than Obsidian's lineup of RPGs? What isn't clear, however, is what this deal would mean for Obsidian's currently unnamed RPG project that is being published by Take-Two Interactive.

We reached out to Microsoft, but a spokesperson told us they do not comment on rumors or speculation.

Steven Messner

With over 7 years of experience with in-depth feature reporting, Steven's mission is to chronicle the fascinating ways that games intersect our lives. Whether it's colossal in-game wars in an MMO, or long-haul truckers who turn to games to protect them from the loneliness of the open road, Steven tries to unearth PC gaming's greatest untold stories. His love of PC gaming started extremely early. Without money to spend, he spent an entire day watching the progress bar on a 25mb download of the Heroes of Might and Magic 2 demo that he then played for at least a hundred hours. It was a good demo.