Warner Bros plans to sell NetherRealm Studios and TT Games, according to documentation seen by Windows Central scribe Jez Corden. Speaking as part of a podcast, the reporter noted that the Mortal Kombat and LEGO developers could be on the chopping block, following a complicated merger which will see overlord AT&T fuse parts of its business with cable company Discovery.
Of course, there has been uncertainty surrounding WB Games for quite some time, and it’s unclear how recent these documents are. There’s also no mention of a potential suitor, although online scuttlebutt has quickly paired the teams with Microsoft given its deep pockets and recent spending spree. Assuming the developer is up for sale, Sony could potentially see value in NetherRealm Studios considering its ownership of fighting game tournament EVO.
Corden believes that movies, not games, may be to blame for Warner Bros’ decision to offload the developers: “My guess would be that Warner Bros weren’t happy with the performance of the Mortal Kombat movie, [and] they weren’t happy with the performance of the LEGO movies. Also, the whole LEGO IP is licensed out of Denmark and that eats into their profits.”
We’re not entirely sure we agree with this theory, as The LEGO Movie grossed almost $500 million at the Box Office, leading to a sequel and a number of spin-offs. As for the Mortal Kombat movie, it did fall short of expectations, but released during the coronavirus crisis earlier this year, which will have affected its performance.
Regardless, it feels like these rumours surrounding Warner Bros are unlikely to go away, so don’t be surprised if any of the publisher’s studios get snapped up soon.
[source youtube.com, via thegamer.com]
It seems like a bit of a silly move if true. TT and NetherRealm aren’t exactly known for releasing flops. Both companies have a readymade audience for basically every game they develop.
Seems like NetherRealm would be a good fit for Sony since they just bought EVO?
It they were to be sold it seems they would be snatched up quickly.
They just can't make up their minds about selling off their major studios.
@mrtennis1990 I'm not saying it wouldn't make sense but it would be quite out of character for Sony to buy a studio like that
I was wondering what the future of the WB LEGO games would be like after Universal got the film rights from them, and boy, looks like my gut was right.
Just imagine 1 second... NetherRealm as a 1st Party Sony Studio developing a AAA Marvel fighting game exclusive to PS5, complete with a lengthy story line.
Won't happen, but the dream is nice...
I'm curious if having a new owner/publisher would negatively affect NetherRealm's future releases?
Maybe it's just pessimistic thinking on my part.
Yes, first LEGO Movie was financial success. Every other movie did worse and worse.
@Voltan that's a good point. With Herman and Jim leading the pack who knows what's in store.
I guess the question is... Are they selling NRS along with the Mortal Kombat IP? Who owns that - the studio or WB?
I really can't imagine anyone other than Ed Boon's team making the next MK game...
@Xenomorph_79 Your wishful thinking
I hope Sony buys Netherealm. Good riddance WB Games!
Sony would be a good fit they're getting big into the fighting game scene at the moment they bought EVO they host MK tourneys all the time on their YouTube channel and PlayStation has kinda always been the home of fighting games fingers crossed
Phil Spencer is aroused.
Not surprising... WarnerMedia/ATT need to make their money back after the continued failed attempts at making a streaming platform and the string of "okish" movies.
But of all the Studios that WB owns. I wouldn’t sell these two.
They also need to put Portkey Games to work and get them to start handing the Wizarding World license to studios who make actual games instead of studio who make trashy mobile games.
Imagine Microsoft having all future mortal kombat and lego games? Gaming is sure going downhill and is starting to slowly make me lose interest in gaming altogether other than JRPG's which will always stay untouched.
Paired with the digital/subscription future gaming is headed towards plus developers being bought left right and centre and more console/timed exclusives than ever, plus gaming getting more and more expensive and the need for all 3 consoles to enjoy the games you used to love all being on one console.
@UltimateOtaku91 I don't agree with you at all.
Also just checked these studios don't even own the ip's of mortal kombat and lego, so even if Microsoft bought them these games would still come to playstation
@Ear_wiG As much as I would like to see Sony buying NetherRealms... I don't think it gonna come cheap, and Sony aren't interested in big purchases. Warner Bro. just sold Playdemic, a mobile game developer, for $1.4 billion to EA... That studio have only ever made one game. NetherRealms is probably gonna cost a pretty penny.
Tencent certainly will be interested
I hope neither Sony or Microsoft buy Netherrealm. That company makes such good games. It deserves to be experienced by everyone. Those games shouldn’t be exclusive to one platform
@Olmaz god I hope that doesn’t happen at all
@Deadlyblack LMAOOOOOO, if anything it might make NRS's games better. Or at least I hope so. I mean, when Ed Boon said they "weren't even close to being done" with extra content for MK11 and then that turned out to be a complete lie, I'd like to think it's because WB pulled funding or assigned a new project. Otherwise, having less than 2 years if support for a AAA fighting game while Street Fighter and Tekken have 4+ is just pathetic these days and a slap in the face to people investing the time to learn them (IMHO).
@anoyonmus What?? Would be amazing. It’s already heavily rumored. Injustice games are great, swapping for Marvel wouldn’t hurt at all.
@FatalBubbles Yea but some people don't like Marvel (like me) and also...PS5 exclusive? $70 game for a console I couldn't buy if I wanted to (aside from giving $1,000 to a scalper). Not for everyone, TBH.
@FatalBubbles I didn’t say moving to Marvel wouldn’t hurt. Going to Marvel games is fine but it shouldn’t be exclusive to one platform. That’s what I am saying.
Ain’t gonna spend $70 for this.
Also I am a huge marvel fan
@UltimateOtaku91 Regarding your comment at #20, if true I think it would be hilarious if MS made the same mistake they did with Rare back in the day. No doubt they'll do their due diligence this time, but if they just bought those studios and failed to get the IP with them, I'd laugh so hard.
The whole WB games department has been openly up for sale for a long time. They only publicly retracted it because no one will meet their price, and they only want to lease their IP rights, not sell.
I don't care who buys em as along as they release a load of new Lego games
This sale makes no sense to me. "Hey guys the Mortal Kombat movie didn't turn out as great as we hoped so let's sell off the makers of the Mortal Kombat video game even though the games do great!" The Lego bit makes even less sense since the Lego movies always do well as do the games.
I'm no business man but this might be the dumbest corporate decision I've seen in quite some time. If they do go up for sale though rest assured both of these teams will likely be snatched up quick. Very strange situation.
It must suck to have your livelihood’s fate tied to what some corporate division decides to do with the IP you work on in other domains. Like the games or not, NRS and TT have been putting out quality titles and done great work for their respective brands.
Shame the Mortal Kombat movie didnt do well. I loved it and think its the best video game movie. I do hope the license goes to someone who can keep it multiplatform.
Just imagine a smash Bros type game done by either nether realms or arc system works.
Buy them and make PlayStation All Stars 2.
The interesting thing is WB will still own the MK/Lego license so even if one of the big 3 were to buy up either studio I highly doubt they would allow their license to be used exclusively for their platform. They would want every penny they can get from letting them use their license and force a move like MLB did with The Show.
Fighting and LEGO games are stupid.
MK11 was the game to get me back into beat em ups
Microsoft: sniff sniff "Is that another developer ready to be gobbled up I smell?"
As sad as it sounds that's the likely scenario. Bub by, Mortal Kombat.
Except if Microsoft bought them you'd never get to play those games because Phil said "our games will only be released where GamePass exists" and PlayStation doesn't have GamePass so we'll be left out in the cold again.
This is getting really bad. Microsoft can't win fair against the other two so they're going for a hostile takeover of the industry instead.
Really hope this doesn't cause problems for Lego Star Wars or end up with Microsoft or Sony blocking Lego games from appearing on other consoles, I really dislike the chomping up of games developers that seems to be the current fad.
Well a Danish company with a lot of money and an interest in making Lego things might be interested in one of them.
@mucc Exactly The studios are of little value if the studio doesn't own the IP
Hopefully with their IPs. It would suck if they just sat on the IP like Konami does.
when they tried to sell the studios before it wasnt with the IP so no one brought them now after the AT&T merger they are trying to do the same thing again
Didn't Jeff grubb say he (as well as others) heard rumours that Microsoft was looking to buy them. People thought it was going to be announced during their e3 press conference.
@Oh_fiddlesticks yeah coincidentally, Grubb starting saying it after it was discussed on Defining Duke between Matty & ACG as a potential big get for Xbox.
I dont think it would be a big get Netherrealm studios without mortal kombat or injustice isnt that great
"This is getting really bad. Microsoft can't win fair against the other two so they're going for a hostile takeover of the industry instead."
Microsoft is buying developers to increase the attractiveness of their lineup on GamePass. There's a tangible benefit to Microsoft's customers when this happens.
Sony has been trying to buy up timed exclusivity left, right, and center because the only means they have to compete is to try and deny random big games from the competition for a limited period of time. No tangible benefit for Sony's customers other than, perhaps, some schadenfreude derived from depriving the rival factions of games they might otherwise enjoy playing on their devices.
It's also worth mentioning that Bethesda and Microsoft have worked closely together for generations. It's not like they got together and said: "Let's randomly buy one of the biggest names in the industry."
I hope this is not true, they're both great studios. Also, take your hands off the new Hogwarts game please business people from WB!
Only a good deal if you get the MK IP with NetherRealm
I hope Soulja Boy buys em. So we can have Def Jam Fight exclusively on the Soulja Boy console. Crank that
Would rather Sony buy Arc System works tbh. Imagine a PS AllStars game done like Dragon Ball Fighterz?
Of the WB studio's, NetherRealm seems to offer the 'best' option to any prospective buyer - assuming they own their IP's. The other studio's are making licensed games so won't come with the License - Lego, Harry Potter, DC etc.
Its almost better for Studio's to recruit those employed at WB studio's - get the 'talent' by growing the studio's you have instead of 'buying' a studio with 'no' IP's. Of course it could lead to those WB studio's being closed down which would be a shame.
If true, that’s the end of Netherrealm studio unless they get bought by a big company like Microsoft or Sony. I don’t see them surviving as a independent studio.
@AdamNovice Arc System Works Would Be a Better Buy I Would Wonder How Sony's Characters Would Look With That Cel Shaded Art Work.
Wow the amount of ppl on here that cant stand Microsoft got Bethesda ,it's business and good businnes by them I might add
Like every company in the world they are there to make money and to be honest like someone else said in these posts it's a benefit for the customers.
If Sony just allowed game pass on playstation there would be no more exclusives With Xbox u think Sony would allow that ? Hell no
@AdamNovice This. Arc Systems Works would be a much better fit for Sony if any had to be bought.
There have been rumours doing the rounds for a while that Microsoft would be interested in NetherRealm, and i could see it happening. I could also see them buying TT games as the lego stuff is good fodder for getting younger gamers invested in gamepass.
Honestly, if Sony want to prove Japan still matters to them, then buying ASW, Level-5 and Nihon Falcom; whilst expanding and deepening their relationship with Square Enix and Capcom- and buying publishing rights to Konami IP is a fantastic way to go
@Martsmall you think Microsoft would allow that, playstation would then become "the" place to play, all of playstations and xbox's exclusives on one machine, no one would buy an xbox ever again and Microsofts console division would end up being pointless.
@UltimateOtaku91 yes they did it on Android /iPhones I bet some ppl have not brought consoles cause they have it on their phones did that stop them ? No
Microsoft would still make a lot of money from game pass and and it's been reported a lot of times ( from Sony as well ) they make a loss on consoles
If Sony had the money to buy NetherRealm we could have some real good Playstation All Stars
@Ralizah So just because they're trying to make gamepass more attractive its a good thing they're going out and buying up giant 3rd party publishers and any developer they can get their hands on solely to keep these games off other platforms? Guess what, those timed exclusive deals Sony does is the exact same appeal. They're trying to get you into their ecosystem. I love how people like you act like timed exclusivity is evil yet buying up an entire publisher with all their IP's is somehow better when at least with timed exclusivity you will be able to play games on other platforms. Why do fanboys pretend Sony is the only one doing these deals anyway? MS are the ones who started it during the 360 gen with GTA 4 DLC, CoD DLC, etc. and they still do it just as often as Sony does today with games like The Medium, Stalker 2, etc. Not to mention MS is using billions gained from outside the games industry to try and slowly monopolize it. Would you like it if Google bought Take Two and made GTA6 Stadia exclusive? I mean they're just trying to widen the appeal of Stadia right?
Also no Bethesda has not worked closely with MS for generations. Morrowind is the only major console game they made that never went to a PS platform and that's because the Ps2 was too weak. You don't work with MS when you make a PC game, there's no licensing required with Windows unlike consoles.
@Ryall Yep, kind of hope LEGO might buy Traveller's Tales - as they would have full access to their IPs and licensed franchises and they know whatever they put out sells like hot cakes.
Sony wouldn't buy it but I could see MS taking it to the green side and that would be yet another blow to Playstation.
Imagine Sony buying them. That would be a power move lol
@mucc that's a good point about Microsoft using billions from outside of its gaming division to strengthen and start up a monopoly for its gaming division. How can anyone compete with that?
The Lego Batman Movie Lego Movie 2 both underperformed in comparison to the first one.
@mucc Again, the difference is that when Microsoft purchases these developers, their doing so explicitly benefits consumers who are subbed to GamePass by making games available for no extra charge on day one. They're investing in the value of their own first-party portfolio and services.
Sony purchasing temp. exclusivity for any major game they can benefits nobody, ultimately. It's just reducing access to games for their competition, with no real benefit for their playerbase.
Microsoft's GamePass strategy is constructive, and represents an investment in the future of their platform. Paying companies to not put games on competitors' hardware is PURELY anti-competitive, and nothing else.
It's fine to be unhappy about PS5 owners losing out on certain previously multiplatform games, but let's not pretend like Sony doesn't acquire developers either, or that Microsoft is attempting to monopolize the industry by buying up developers left and right. That's just not reflective of reality.
Let's hope Microsoft doesn't buy either of these studios. They are trying to buy everything they can to make themselves seem cool.
@Ralizah You can spin it whichever way you want but the reality is buying out a 3rd party publisher to take games off other platforms isn't beneficial to consumers in any way. MS doesn't have to buy publishers to have their games on Gamepass. it is absolutely idiotic to try and say that a temporary exclusivity deal is somehow worse than permanently not releasing on other platforms just because something will come day one to Gamepass. You're acting as if these huge buyouts are good solely because of Gamepass which is ridiculous. You realize you pay for Gamepass right? It's not free.
Your 3rd paragraph makes no sense, everything either company does is investing in the future of their platform. MS is literally doing the same thing and worse by making it permanent. But once again all's well because durr Gamepass durr right? So if Sony did temporary exclusive deals and put them on PS Now would that be better since its cheaper to rent games?
Finally don't even try to compare Sony or even Nintendo's developer acquisitions to what MS is doing. Basically every studio either of the former two have purchased they've already owned the IP's for or they were primarily 2nd party studios to begin with so they weren't taking anything away from other platforms. That is nothing like buying up a giant 3rd party publisher and all of their IP's. They absolutely are trying to monopolize the industry. It's the entire reason why they're building up Gamepass and taking huge losses for now so they can get tons of subscribers and if it does become the biggest platform in gaming, now everything basically runs through them.
Strange considering NRS make big hits, MK11 was a huge success as was Injustice 2. Hopefully Sony buys them as MS love infecting MP games with some pretty terrible monetization, Sony do as well but not as bad as MS who are on par with the likes of WB and EA for it just minus the lootboxes.
I heard a rumour that Microsoft is buying leapfrog and is going to make a halo spin off called halo infancy, it’s exclusive to the leappad gamepass store. Big loss for PlayStation #doomed
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Just finish and release the SW Lego game please 🥺
In other news, rockstar confirms, "director of gta vi hasn't even been born yet"
“ the need for all 3 consoles to enjoy the games you used to love all being on one console.”
It’s always been the case that you needed more than one system to play all the good games in a generation.
netherealm is a good pick for sony
imagine ps all star ala mk
kratos vs ellie
jin vs drake
Another example of stupid or inexplicable business decisions which hurt consumers.
Not to mention scrapping a company which makes successful games…
@nessisonett exactly. This kind of scorched earth approach is just ridiculous.
As consumers we can cease buying their products. I no longer support Activision or EA for these reasons.
@TwomanybuttonS I heard they are adding light savers and he-man too
I wonder if Fighting games beyond Smash are popular enough and sell well enough day one to survive a generational cost hike? Microsoft has already dissolved the Killer Instinct team, Tekken has had numerous cancellations and disappointments, and Street Fighter only got made because Sony subsidised it with a new business model that everyone hated. The sudden halt of MK DLC seasons may also back this up.
I personally hope that neither studios gets bought by Sony or Microsoft. I wouldn't want these beloved franchises to be locked to one console.
Just came back from 2025. Netherealm added a few Killer Instinct characters to Mortal Kombat 12 and just released a full new Killer Instinct game.
@Buckeye4Life2015 they wont because WB will still own the IP
Update the article.
The rumors are false.
theGamer's article got updated.
@chicken_chaser Probably the best case scenario
@Voltan And the price may be a factor to Sony is no MS.
@Ralizah Sony mostly buys studio's they worked with for years and most of their games are released on the Playstation exclusive.
@BoldAndBrash Please no battle royale. ☹️ I love the format of smash. I’ve tried several BRs and can’t get into them at all.
@mucc You are correct that people generally have to pay for GamePass. With their frequent deals of $1/month or $1/3 months plus Ms rewards I have 1.5 years of GamePass for $1. So to me, any games they bring to GamePass is essentially free. I doubt I’m alone in this approach.
It’s a very good thing for MS consumers, it’s not good for other system owners. As @Ralizah mentioned, timed exclusivity doesn’t help any consumers. So while MS buying stuff only helps GamePass folks it’s better than no one. I don’t know that either way is wrong or right but in terms of outcomes with GamePass someone at least wins. But you are correct in saying that MS could buy games for GamePass without buying studios which they often do. It absolutely would be better if PS Now was as easy to acquire and Sony bought games for it but that’s not their approach.
I have both consoles so I’m happy regardless. I imagine the people who get mad about this stuff only have one console which is understandable.
Sony should buy NetherRealm, TT Games
@FatalBubbles "It’s a very good thing for MS consumers"
I fail to see how it's good for MS consumers, except on the very short term.
We have seen what happened to the general quality in the music industry when it went digital with subscriptions. We are seeing that again with movies. A lot more products are being made, with a few really good, but the general quality is getting lower and lower, while the consumer get to own less and less.
Microsoft's approach (and they are sadly not alone) will unavoidably lead to the same results for games, won't it? If so, how is it good for MS consumers if what they will get will be of less and less value with time?
@Olmaz If the games they put out suck then sure, it’s bad. As of right now, that’s just speculation. If Halo and Forza 5 are trash then I’d say it’s very bad.
@FatalBubbles I don't think it's speculation. When you don't need to incentivize purchase from customer by offering quality because you have sheer quantity, the companies on your platform will deliver more and more products of lesser quality.
Whatever the model chosen by Microsoft (one time payment or payment by downloads for the devs), every developer will only want to push more games on the platform, not better ones that take longer to develop.
Again, this is what is happening with Netflix. At first, it was an incredible push for creativity and quality, because they needed to attract people to the platform. But now, it's more and more just small and quick projects that are mostly mediocre.
Same with Disney+. Right now, it's getting new customers for their excellent Marvel and Star Wars shows. But really soon, we will be swimming in a plethora of good-to-mediocre shows for that platform, because they'll need to make their customer feel they get their money back in term of quantity.
I don't see why it should end differently with GamePass. We may have a few very good years to come, with really good first party games, but after that, it will go downhill because the incentive for MS wll not be to bring new customers with flashy and excellent games, but to retain current customers with the sheer amount of what they can play.
@Olmaz So if I understand correctly you think Bethesda will just stop making good games?
I’ve seen the Netflix reference a lot and o can see the comparison to an extent.
If Microsoft has all their first party studios not try and make good games then they deserve to fail and I’ll be down to owning a PS5 only.
Until their first party stuff comes out and it’s not good I think you’re prematurely digging their grave. We will know within the next 2-3 years if it’s going to be any good.
Ughh, really hope neither Sony or Microsoft buy them to be honest.
Sony needs to jump on this
@Olmaz What is with these continued comparisons to Netflix. The issue with Netflix is Netflix own doing. They waited too long in creating their own content and relied too heavily on 3rd party content and IPs. That when major companies like Disney started pulling shows and movies. Netflix was left scrambling to provide their own content for the platform. Truth be told... Netflix doesn't make enough profit for that, so they still to have make deals and buy exclusive streaming right to 3rd party shows and movies. Meaning there is only so money much left for their own in house shows and movies.
Microsoft doesn't have this problem. They are already setting themselves up better than Netflix did. Microsoft from day 1 was already pushing their own in house created content. Microsoft buying major publisher like Bethesda is so when companies like EA and Ubisoft start pulling their games from the platform. Microsoft aren't left scrambling to try and catch up by lowering the quality of games. Microsoft also aren't just limiting their game to services like Gamepass cause not everyone is running to gamepass. These games are still sold on their own and will still be able pay for their development cost even if gamepass doesn't. Meaning the games still have to be released in a high quality state... If these games was Gamepass exclusive then it would be a different story.
Also Microsoft also make billions of dollar in profit unlike Netflix, so they can continuely crank out high quality games without taking a hit to profits.
I have trouble believing this. I don't know how lego games do, but NR sells millions of copies and DLC. It would be insane to offload such a big money maker.
@Voltan That is a very important point.
The studios and the IP's are very different things.
TT without lego and NR without MK and Injustice, can they produce hits of similar proportions?
Unconfirmed rumor, I'm not worrying until officially confirmed.
@Ralizah There is a tangible effect for game pass owners? Oh really? What exactly are you getting that you weren't before?
Oh that's right... nothing. Also, there is a difference between a timed exclusivity deal and an outright buy out. One is temporary.
So, you're telling me, LEGO STAR WARS THE SKYWALKER SAGA may be completed but is stuck in some time of corporate limbo? I hate capitalism.....
@mrtennis1990 If MK IP is not part of Nether Realms Studio how does that help Sony? Plus I expect WB is still expecting more money than these studios are worth so it might be too much money for what Sony would get out of it. And Sony doesn't like to spend large sums of money on studios and like to have a long history with a studio at some level. The cost may be driven up especially if MS is actively seeking NR as well.
In contrast, it would help MS directly since they have Killer Instinct IP and no developer for it and fighting game developers are a breed among themselves (an art form that doesn't easily translate from other game genre devs) And ED Boone, MK co-creator and lead dev at NR, has been noted that he would love to make a KI game or even more a KI and MK cross over game.
The first Lego movie did surprisingly well. Beyond all expectations. But that led to Warner inundating us with several Lego movies that did not fare well. WB with movies like Sony has noted recently with games is looking for big bangers rather than investing in smaller movies.
As for WB Games, almost all their IP is licensed. Either they licensed it from someone (Middle Earth, Potter, Lego) or they own it via DC and not directly owned by the game studios. And that has been the problem with Warner trying to sell almost all their studios where either DC IP would have to have a long-term deal to make it sense for the price and then for the other IP it is locked licensing hell for all the other content that Warner Games is using.
As for TT, I think that would be a great fit for Xbox needs. Spencer specifically said several times that more family-oriented games are in their headlights to balance out their catalog. TT would fit that need quite well. It would. as well, lead to a lot of content immediately to GP with the 40 or so Lego games they have done. And I think Lego (who has worked with MS several times already) would not have a problem continue to license the IP. And there is a lot of content in the Xbox catalog that they could use (beyond the normal Disney,r DC or Marvel IP) they do already. Imagine Fall Out or Halo TT-based Lego game. Cross license those with Legos as well. I think if MS did get TT in many cases they would treat it like Minecraft (or maybe licensing would force them) have the games go multi-plat (minus games that are using MS IP). But again this is all about GP. And TT is good for one or two games a year for GP day and date.
MK IP is questionable. I have been told by someone who has better knowledge about Nether Realms Studio that the MK is owned by the game studio, not under Warner proper. Now MK could be retained by Warner in the studio sale but, that just means they won't get any price near the numbers they want. This would be OK for Xbox since they have Killer Instinct to use NR for but, no IP would not benefit Sony if they were to buy NR. Or ATT/Time-Warner could make a long-term deal for MK film licenses and let Nether Realm Studio retain the rights. Not like MK movies (at any time) have been giant earners. So maybe Warner won't care about the movie rights or retaining the IP at all.
I feel like MS, Sony, and Tencent should stay away from this and have the other publishers eat.
Dont get me wrong I dont want EA or Ubisoft to buy it either but it would be better if someone like say Bandai Namco or 505 games got them.
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