Microsoft doesn't own the Sunset Overdrive IP, but I will bet they have first say on publishing rights on the franchise from here on out. It's how they handled Gears of War and they never actually owned the IP until last year. Microsoft typically works out a deal where they get first say on publishing for sequels on titles. Mass Effect was an odd case because Bioware was purchased by EA effectively voiding that deal with Microsoft on the first Mass Effect.
They have their own studios and they're all working on stuff. Microsoft doesn't act like Sony in that they don't put priority on owning the IP or the studio but would rather want exclusive publishing rights for games.
And yet the possibility remains Sunset Overdrive can go multiplatform and thus gamers will hold out hope and wait and wait until either they can buy the game cheap or on a better performing platform. There will always be uncertainty surrounding games by external studios unless Microsoft have the IP completely locked down.
Gears of War worked out great for them. It became a billion dollar franchise synonymous with third person action games. We also know Microsoft had to pay a pretty penny to acquire that IP - in fact, they even killed a new IP by one newly created studios, Black Tusk, to fast track making a return on that acquisition. I'd argue Microsoft would've been better off owning the Gears of War IP right from the beginning.
I wasn't going to bring up Mass Effect because I know that's a different situation altogether unlikely repeat itself.
Microsoft have their own studios, yes, but which one of them is really known for being an amazing studio that makes great games, 343? They made a great looking game but many would argue it's not a particularly good Halo game. Turn 10? Forza 5 got lambasted with criticism for their shitty micro transactions. Lionhead? They arguably haven't made a good core game since Fable 2.
When it comes to first party, Microsoft's biggest problem is the fact that they turn every AAA studio they own into a factory for one big IP. Sure, Lionhead is supposedly working on a new franchise, but let's be honest, they should've moved on to something new a long time ago.
If I were in Phil Spencer's position, the first thing I would do is acquire studios that have worked closely with MGS. Remedy, Playground, Ruffian, Frontier Developments - all these studios that have worked on Xbox games and IP that presumably share a good relationship with the Xbox team. Double Helix serves as an example of what happens if Microsoft doesn't pull the trigger on a talented studio. Hell, Bioware should've taught them their lesson on owning the studios that create games they fund.
From there, I'd go out and acquire studios that I know are open to acquisition or probably soon won't have a choice due to financial woes, e.g. like Harmonix. I'd be aggressive and assertive about getting as much proven talent on board as well as creating new studios.
What's more, I'd make sure these studios worked in multiple teams on multiple IP to keep them cycling and avoid layoffs whilst creating new experiences without letting older IP get to stale or lead to franchise fatigue.
Xbox needs 1st party studios that are not only diverse but are allowed creative freedom and are allowed to take risk when they've earned it with new IPs - look at just how well that payed off for Sony with Naughty Dog? Those guys cranked a few critically and commercially well received Uncharted games before creating The Last of Us, and I shouldn't have to tell you how successful that new IP is.
All of the above is what Phil Spencer should be doing to improve on 1st party. Sure, funding a promising game from an external studio should still be on the table, but it shouldn't be what Microsoft relies on to support Xbox.
