The news is so sensational that we can’t even find an ironic or paradoxical introduction, as is our habit. So here’s the news, without paraphrasing: Microsoft buys Activision Blizzard for nearly $ 70 billion (68.7, to be precise). And it goes without saying that the operation will have major repercussions not only in the gaming universe, but also in the chessboard of tech giants.
We have to go back a few months, and think back to the recent shocks of the company led by Mark Zuckerberg (from the Facebook Papers scandal to the rebranding in Meta) to find similar news in terms of scope and consequences.
The transaction, in cash, has already been approved by the boards of directors of both companies. And it’s the largest ever among those made by the Redmond-based company.
The news had already leaked from US agencies, but has now been made official by a note published on the Microsoft blog on January 18.
The grandiloquent title well reflects the importance of the operation: “Microsoft to acquire Activision Blizzard to bring the joy and community of gaming to everyone, across every device”. That is: “Microsoft will acquire Activision Blizzard to bring the joy and community of the game to everyone, on every device”.
The operation
The action is therefore unprecedented: Microsoft buys Activision for a record $ 68.7 billion. And the title of the note, beyond the tone, carries within itself the sense of the action: the company led by Satya Nadella has decided to bet unconditionally on gaming.
The transaction took place at a cost of $ 95 for each share of the video game manufacturer and distributor. And, meanwhile, Sony’s shares have plummeted on the stock market.
In the note, it is Nadella himself who expresses Microsoft’s great interest in the world of video games: “Gaming is the most dynamic and exciting category of entertainment among all platforms and will play a fundamental role in the development of the metaverse. We are investing heavily in world-class content, community and cloud technologies to usher in a new era in the world of video games, which puts players and developers first, making games safe, inclusive and accessible to all ”.
The words of the CEO of Microsoft capture two important aspects. The last sentences reassure with respect to some recent controversies about the alleged toxic and sexist environment that would be experienced in Activision. And for which 40 employees were laid off.
But one of the profound meanings of the acquisition is indicated with the reference to the metaverse, in which – obviously – Microsoft also wants to play a central role.
Activision Blizzard
Activision Blizzard was born in 2008 from the merger of the two brands.
The Activision company appears in 1979 under the impulse of a group of Atari employees who decided to set up their own business. Having become one of the most famous brands in the industry, it has been led by Robert Kotick since 1991. Activision in 2008, after joining the Vivendi group, merged with Blizzard, another historical brand in the sector.
Activision Blizzard brings to the Redmond company titles such as Call of Duty, Candy Crush, Crash Bandicoot, Guitar Hero, Heartstone and World of Warcraft.
Exclusive or cross-platform games?
Many fans and curious will be wondering: Will Activision’s currently cross-platform titles become exclusive?
Microsoft’s note in this sense is cryptic: “Microsoft wants to keep some of the Activision games on PlayStation consoles, but will also want to keep Xbox-exclusive content.” Even Bloomberg, who analyzed this aspect, adds nothing different. It will probably be evaluated on a case-by-case basis.
What is certain is that Microsoft, with the acquisition of Activision, becomes the third giant in the world of video games by revenues. In fact, it places itself behind Tencent and Sony.
Just remember that the monthly users of the products created by Activision are around 400 million.
In 2021, gaming brought the Redmond-based company more than $ 10 billion in revenues.
The gaming boom
Microsoft buys Activision and does so a year after the acquisition (for 7.5 billion dollars) of ZeniMax, a company of the publisher Bethesda Softworks, which has produced games such as The Elder Scrolls, Doom and Fallout.
The Xbox company is therefore taking advantage of the boost that the pandemic has given to gaming. And the future of the industry looks even brighter: a study by the research firm Newzoo tells us that the market for games for mobile platforms (smartphones and similar) will reach a turnover of 116.4 billion dollars by 2024.
The future role of Robert Kotick
After the historic acquisition, Robert “Bobby” Kotick will remain at the helm of Activision Blizzard. But it will report its work to Phil Spencer, head of Microsoft Gaming.
Kotick himself said: “After closing the agreement, we will have a lot of work to do to continue building an environment where everyone can give their best to work”.
Times
The acquisition is expected to close by the end of 2023. Subject, however, to legislative vetoes. Recently, both Europe and the United States are thinking about the opportunity to limit large tech companies, with the aim of reducing their excessive power and stimulating competition.