South of Midnight Studio Compulsion Games Completes Buyout from Xbox
Compulsion Games, the studio behind the critically acclaimed South of Midnight, has officially completed its buyout from Xbox and is now a fully independent developer. The Montreal-based studio confirmed the news on August 20, 2026, marking the end of its time as a Microsoft first-party studio and the beginning of a new chapter in its history. Crucially, Compulsion retained ownership of all its intellectual property as part of the deal, meaning the South of Midnight IP stays with the team that created it.
The studio made clear just how determined it was to stick together through the transition, with a statement that left little room for ambiguity: "We would rather eat rocks and drink gasoline than be split up." While the road ahead is still taking shape, the team appears unified and energized by its newfound independence. What comes next for Compulsion Games and the South of Midnight universe remains to be seen, but the studio is at least navigating its future with its creative assets fully intact.
Key Insights
- 1Compulsion Games has officially completed its buyout from Xbox and is now a fully independent studio.
- 2The studio retains full ownership of the South of Midnight IP, keeping its creative assets in-house.
- 3The team expressed fierce commitment to staying together during the separation process.
- 4The future direction of the studio and any follow-up to South of Midnight remains unclear for now.
- 5The buyout is part of a broader trend of Microsoft restructuring its first-party gaming operations.
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