But is it really that necessary to have a lot of strong first party devs? The way I see it, MS is doing pretty well with their current approach.
I also don't think that those studios are that important, just look at what Bizarre has done recently: far from impressive. Digital Anvil and FASA were just the same, I wouldn't cry for them. Ensemble might have been a loss, but it sounds like their entire company culture was a big hindrance in actually delivering games. Bioware might be the only big thing here, but as good as their games are, you still can't say that they'd sell that well.
I disagree perhaps Digital Anvil and FASA are not great studios, but Bizarre is definitely a AAA dev their games are always polished to near perfection, just see Geometry Wars (a title which practically defined XBLA).
PGR4 is also still a better looking game than Forza 3 despite being 2 yrs older. And much of Forza 3's MP features ('cat and mouse' races) were inspired by PGR.
And Blur is definitely innovative and fresh and has been getting pretty positive previews:
http://www.eurogamer.net/articles/blur-final-hands-on?page=1
It also does 4 player splitscreen which is rare for a racing game.
Fact is not many reviewers or core gamers would put MS 360 exclusives at the same level of titles like KZ2, Uncharted, GT5, God of War, LittleBigPlanet, MGS4 etc. (especially not technically). In fact on 360 the best looking games are often multiplat titles or run on MP engines (ie. Gears, Mass Effect, COD, Assassins Creed) or are made by independent studios (ie Alan Wake or Metro 2033), the first party, platform exclusive studios should be at the graphical forefront like is the case on PS3.
Also, the best games on PS3 apart from the few AAA multiplat titles (COD, GTA etc) are all platform exclusives.
What are the most popular titles on 360? COD, GTA, all the sport games, Guitar Hero/Rock Band, Assassin's Creed, Fallout 3/Oblivion, the LEGO games with platform exclusives pretty much being Halo, Gears and to a lesser degree Forza and Fable (largely helped by console bundling).
Don't forget that the PS3 is catching up to the 360 in sales and will likely overtake it, MS poor first party support is definitely not helping. Sony has the upper hand in hardware (which is to be expected) but why are they also coming out on top with software? I mean it is
Microsoft.
And whats the point of shelling out for exclusive DLC like the 50 million they paid for a year's exclusivity on the 2 GTA4 episodes, did that lead to an commensurate increase in sales for the 360 version? Not really, 6.5 m vs 7.7m an extra 1.2 million copies but the 360 had a significant lead in console sales when the game launched
That was a waste of money, you could develop a whole new AAA title for $50 million
I dislike Microsoft's new direction on exclusive titles (compared to the original Xobox), perhaps its better from their accountants standpoints but its worse for us gamers.
On Xbox there were so many