Microsoft justified the acquisition of Activision Blizzard, among other things, with the aim of wanting to build a mobile Xbox store.
Microsoft has told the UK’s Competition and Markets Authority (CMA) its intentions to take over Activision Blizzard.
A reason for the purchase of Activision Blizzard is therefore the expansion of the presence in the mobile sector. In order to create a next-gen store for games and attract customers from Google and Apple, especially for mobile devices, it is necessary to have the Activision Blizzard catalog in order to be able to offer an attractive offer.
According to The Verge, the response to the CMA states:
“The transaction will enhance Microsoft’s ability to create a next-generation games store that can operate across a range of devices, including mobile, as Activision Blizzard’s content is added. Building on Activision Blizzard’s existing player communities, Xbox will seek to extend the Xbox Store to mobile devices and attract players to a new Xbox Mobile platform. However, moving consumers away from the Google Play Store and App Store on mobile devices will require a fundamental shift in consumer behavior. Microsoft hopes that by offering familiar and popular content, players will be more inclined to try something new.”
Microsoft is trying to attract new players with well-known games and brands such as Call of Duty Mobile or Candy Crush Saga, but mainly to win over existing players from other platforms.
Xbox Cloud Gaming would of course make an ideal complement for mobile devices and tablets. Bringing the service to Apple devices as a third-party app has proven difficult in the past due to the strict requirements.
That hasn’t stopped Microsoft from pushing Xbox Game Pass with cloud gaming on other fronts, like on the Steam Deck or through partnerships with Logitech and Razer.
Mobile gaming revenue is huge and Microsoft lacks the footprint to generate revenue in this space. The company told the CMA that revenue from Call of Duty Mobile, the King division and others accounted for three quarters of monthly active users.
“The transaction gives Microsoft a significant presence in the mobile gaming space. Revenue from the King division and titles like Call of Duty: Mobile, as well as ancillary revenue, accounted for more than half of Activision Blizzard’s… revenue in the first half of 2022. Mobile customers account for about three quarters of MAU (Monthly Active Users). Microsoft currently has no significant presence in the mobile gaming space, and the transaction will bring much-needed expertise in mobile gaming development, marketing and advertising. Activision Blizzard will be able to bring its expertise in developing and publishing mobile games to Xbox game studios.”
Microsoft is also working on principles that will allow developers on a future Xbox mobile platform to run their own app stores for their games. The in-app purchases could also be processed with your own payment methods. Compared to other platforms, this could turn out to be a lucrative advantage for developer studios.
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