There are deals that change history forever. And at least in the gaming world, such a deal has just taken place: Microsoft is buying Activision Blizzard – for a whopping $68.7 billion. That’s about as much money as you have to spend in FIFA 22 to dust off all Ultimate Team cards. But Microsoft really has bigger goals than a football team – especially with its Game Pass:
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What happened there?
Anyone who hasn’t lived under a rock in recent weeks will have noticed the scandals that are spreading like an avalanche across Activision Blizzard. State investigations into widespread incidents of sexual abuse, numerous layoffs, this is not only a disaster for Activision’s PR. The share price fell by almost 30 percent, many fans called for the resignation of Activision CEO Bobby Kotick. Now the future of the company is clear.
Under Microsoft’s aegis should Extend Microsoft’s inclusive culture to the great teams at Activision Blizzard
, so Phil Spencer in the official statement on the takeover. The procedure is not yet complete: Microsoft and Activision Blizzard will work independently of each other until the final purchase is completed, after which the merger will begin. Out Microsoft’s press release
Once the transactions close, Microsoft will be the world’s third largest gaming group by revenue after Tencent and Sony. The proposed acquisition includes famous Activision, Blizzard and King franchises such as Warcraft, Diablo, Overwatch, Call of Duty and Candy Crush – plus, of course, Major League Gaming’s global esports operations. The group employs almost 10,000 people in its studios worldwide.
The integration of the Activision Blizzard studios into the large Microsoft family will of course also affect the games. As many Activision and Blizzard games as possible
should go to Game Pass, according to Spencer. So you’ll probably be able to play Call of Duty, Overwatch, Diablo and maybe even World of Warcraft in Game Pass in the near future. Not a bad prospect, right?
Do you want to put the deal in another relation? Take Two has to give up the record for the most expensive takeover in the video game industry after just a few days. It was only on January 10, 2022 that the purchase of Zynga was announced – for 12.7 billion US dollars. If you now juggle the numbers in your head, you will find that Microsoft has calculated this sum by more than fivefold trumped. This puts you in the List of the most expensive acquisitions very, very lonely at the top.
When does it really start?
Meanwhile, Bobby Kotick has informs its own workforce about the near future by e-mail. He emphasizes in a fairly comprehensive manner why Microsoft is exactly the right choice in the current market environment, but the really exciting info: Things will stay the way they are for quite a while. Activision Blizzard will continue to work independently for many months, because the merger should not be completed until fiscal year 2023 – i.e. by June 2023 at the latest.
Part of a grand strategy
This purchase isn’t the first big move in Microsoft’s Game Pass strategy. After the publisher had built up a portfolio of its own triple-A and double-A studios (like Obsidian) over the years, the takeover of Bethesda in 2020 heralded a major turning point. More and more games are ending up in Game Pass: EA’s complete arsenal including Battlefield 2042, Star Wars Jedi: Fallen Order and Co. Bethesda’s new role-playing epic Starfield is also coming exclusively for PC and Xbox. Well, and now very likely a Diablo 4 as well.
You can find out more about this strategy in our detailed analysis of Microsoft’s takeover strategy. Or in our podcast with management consultant Human Nagafi:
more on the subject
Microsoft’s Bethesda acquisition is a blessing – or a nightmare
The question of the future naturally arises: With Ubisoft and Rockstar, there are actually only two big players in the race that appear sporadically in Game Pass. But that too is changing. At the beginning of January 2022, the news circulated that Microsoft and Ubisoft would work more closely together in the future.
Ubi’s in-house subscription service Ubisoft+ will soon be available on Xbox consoles. And games like Rainbow Six Extraction are moving to Game Pass. With GTA 5, Rockstar also had its own money printing machine that had become a game in the Game Pass.
At some point, Microsoft is likely to reach a point where you can definitely discuss a possible monopoly. Jason Schreier already hinted at this in his tweet about the acquisition of Activision:
link to Twitter content
But until then, it is primarily to be hoped that the takeover will bring improvement for the Activision Blizzard workforce in the long term. In addition, we are of course curious to see how Sony reacts to these steps. It is conceivable that the Japanese group is now also considering one or the other takeover in order not to be left behind in the long term.
Leya and Schuhmann from MeinMMO recorded a breaking podcast with Michael Graf right after the takeover:
link to Spotify content
What do you think of the amazing deal? Do you see Microsoft’s growing market power with concern or are you happy that more top-class players are now moving into the Game Pass? Write us your opinion in the comments!
