Sources: Warner Bros in talks with Microsoft about Xbox Entertainment Studio

After Microsoft announced last month it will be shutting down Xbox Entertainment Studios (XES), the film division is in a search for a new home, if sources are correct.

Sources told The Hollywood Reporter today the filming division is looking for a new owner and that it had preliminary talks with Warner Bros. With an $18 million investment on Machinima, WB would merge XES and the multichannel network. Still, a deal seems unlikely between Warner Bros and Microsoft, according to sources. Representatives from XES and  Machinima had no comments, while a WB spokeswoman said the media company is “constantly having preliminary discussions regarding business opportunities with numerous companies at any given time. A conversation is just that — a conversation.”

The original plan by Microsoft was to bring original TV content to its consoles. However, the company changed course months after Satya Nadella became CEO and presented his plans to shut down divisions and lay off employees in the process.

[Source]: The Hollywood Reporter: Xbox Shops Entertainment Studio to Warner Bros. [http://www.hollywoodreporter.com/news/xbox-shops-entertainment-studio-warner-725562].