Microsoft scoops up four game studios for Xbox and creates one of its own

Microsoft bought four gaming studios, including the makers of popular games "Forza" and "Hellblade," in a move to increase emphasis on creating its own games for Xbox.

Xbox chief Phil Spencer announced the acquisitions during the E3 gaming convention in Los Angeles. The new studios will pump up the number of games available exclusively on Xbox, in a move addressing criticism that Microsoft has fallen behind its peers in launching innovative games for its console.

Microsoft also said it would start a new studio of its own, called the Initiative, which will be based in Santa Monica, Calif.

The four game studios Microsoft scooped up are Playground Games, the maker of "Forza"; Ninja Theory, the studio behind "Hellblade"; Compulsion Games, developer of the upcoming adventure game "We Happy Few"; and Seattle-based Undead Labs.

The acquisition for Playground has closed, while the others are pending.

Undead Labs developed the post-apocolyptic zombie survival game "State of Decay" and launched the sequel to the game just last month. The studio is led by gaming entrepreneur Jeff Strain, who previously worked at big firm Blizzard Entertainment and co-founded game developer ArenaNet.

Microsoft has partnered with Undead since the company's early days — about five years ago — as the publisher of the "State of Decay" series.

The four acquisitions mark a major expansion of Microsoft Studios in a move to ensure that Xbox has plenty of games made for the gaming console, and by the team behind the console.

The purchases, and the resulting games to come from them, will help the company compete with Sony, which is known for its creative art-house games, and Nintendo, which has seen a huge boost in popularity since announcing the Switch gaming console.

This is the first big news for the division after Xbox in January promoted Matt Booty, who previously oversaw "Minecraft," to lead all of Microsoft Studios.

"We believe these teams have the collective creative power and operational excellence to deliver the next industry game changer," Booty said in a statement.