Xbox Reportedly Bungled $500 Million Netflix Exclusivity Deal To Develop Movies, Shows Based On Games - Kotaku

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According to industry insiders, newly appointed Xbox CEO Asha Sharma overplayed cross-media potential with recent Netflix exec Peter Rice to the tune of $800 million

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By Zack Kotzer Published October 24, 2026 | Comments (7) | 𝕏

The TV-pulled-from-video-games industry is on the rise, including at Xbox. Earlier this month, Microsoft announced a new department dedicated to cross-media property development. Now a new report claims Xbox and Netflix were in talks for an ambitious, multi-year exclusivity deal to adapt several Xbox franchises into TV shows and movies, but negotiations fell apart when Microsoft allegedly demanded a price that was too high.

Puck News‘ Matthew Belloni reported that a deal was forming between Xbox and Netflix to develop projects based on its extensive gaming portfolio. It was revealed that the streaming megalith offered newly appointed Xbox CEO Asha Sharma $500 million for exclusive rights to adapt a great deal of their intellectual property over a seven year period. A shiny figure. A healthy chunk of time. But Sharma apparently upped the ante to $800 million, at which point Netflix rescinded the offer.

“We won’t comment on specific bids or negotiations,” Microsoft said in a statement. “We have received record-breaking interest in our IP; our priority is the right creative partner and release model for every franchise and project. Netflix is a valued partner and we are excited for the forthcoming release of our Minecraft and Diablo animated series together, and among other adaptations.”

Belloni writes that in response to the failed wager, Xbox is seeking less exhaustive, smaller deals with multiple production partners. Microsoft will be looking to re-create the success of the Minecraft movie and the Fallout TV series on Amazon across the rest of its gaming franchises and recently built a new entertainment division called XP to help lead those efforts.

As game development becomes outrageously costly and gaming itself prohibitively expensive, publishers big and small are seeking cross-media deals to double dip on their properties. HBO’s The Last of Us and Illumination’s Super Mario movies have rallied audiences, often rerouting attention back to the source material. Giving existing back catalogues a second wind.

It’s a phenomenon Xbox is plenty familiar with as well. Both Warner Bros.’ Minecraft movie and Amazon’s Fallout show proved to be monumental hits. Not all cross-media expanses are made equally. Despite being the crown jewel of Xbox, Paramount’s Halo series failed to capture the zeitgeist as effectively as the studio’s Sega pursuits.

It’s unclear which games Netflix was hoping to develop, but Microsoft literally has more games than they know what to do with. At the same time, it’s a big wide world. Doom, Elder Scrolls, Gears of War, Call of Duty, Space Quest. As big as Xbox’s tank is, there are ultimately plenty more fish in the sea for Netflix to cook with. As is Netflix has developed shows around Cyberpunk, League of Legends, The Witcher, Castlevania and streaming rights to the live-action Zelda next year.

Correction 10/25/26, 9:21 a.m. ET: Updated headline and subtitle to focus on the reported values of the deals being negotiated and removed speculation about the deal’s connection to XP.