While Xbox still plans on releasing Halo: Nightfall and the rest of its Halo-based programming, the big M is supposedly looking for someone to take Xbox Entertainment Studios off of its hands.

Inside sources have told The Hollywood Reporter that Microsoft is trying to sell off Xbox Entertainment Studios and has started preliminary talks with Warner Bros in regards to a deal. The idea is that Microsoft would like Xbox Entertainment Studios to remain intact as a stand-alone branch inside of the house of Looney Tunes, liekly as a part of Machinima.

Last month, Microsoft decided to close its television programming studio before it started rolling into production a full slate of various TV shows that it was going to air via Xbox Live. In an array of budget cuts, Microsoft announced the closing of the studio and its intent to lay off over 18,000 employees by the end of the year. Mind you, one of the only programs Xbox Entertainment Studios launched was a street soccer documentary, and some genius decided it was a great idea to air the show during the week of the World Cup, which all soccer fans would be watching on public TV instead of this documentary on Xbox systems.

Warner Bros. was likely chosen because it owns an $18 million stake in Machinima, which is filled with video game-centered content, and its core audience perfectly lines up with XES'. Mind you, Machinima already helped Xbox distribute Halo 4: Forward Unto Dawn.

A representative for Warner Bros. told The Hollywood Reporter that the company is “constantly having preliminary discussions regarding business opportunities with numerous companies at any given time. A conversation is just that — a conversation.”

Unfortunately, representatives from Xbox refused to comment when asked about its possible venture with Warner Bros.