Microsoft Wants To Buy Activision Blizzard To Make Gaming The Largest Online Entertainment

18/01/2022

Microsoft is the tech giant that is among the largest in the world. With reach and influence spanning across different industries, the company has the capacity to disrupt whatever it lays its hands on.

After entering the gaming industry with Xbox, the company is further cementing its presence by acquiring Activision Blizzard, a gaming company considered among the leaders in the gaming industry.

Activision Blizzard is being acquired by Microsoft for $95.00 per share, in an all-cash transaction valued at $68.7 billion.

The price far exceeds the $26 billion Microsoft paid to acquire LinkedIn in 2016.

Fueled by a new generation of entertainment is powered by the internet and mobile, the acquisition is Microsoft the world's third-largest gaming company by revenue, surpassed by only Tencent and Sony.

Microsoft - Activision Blizzard

By acquiring Activision Blizzard, Microsoft is bringing in 10,000 new employees working on popular titles like Warcraft, Diablo, Overwatch, Call of Duty, Crash Bandicoot, Guitar Hero, StarCraft, and more.

The goal of this acquisition is to accelerate the growth in Microsoft's gaming business across mobile, PC, console and cloud.

What's more, it's also meant to provide Microsoft the building blocks to build its own metaverse.

"Gaming is the most dynamic and exciting category in entertainment across all platforms today and will play a key role in the development of metaverse platforms," said Satya Nadella, Chairman and CEO of Microsoft.

"We're investing deeply in world-class content, community and the cloud to usher in a new era of gaming that puts players and creators first and makes gaming safe, inclusive and accessible to all."

"Players everywhere love Activision Blizzard games, and we believe the creative teams have their best work in front of them," said Phil Spencer, CEO of Microsoft Gaming. "Together we will build a future where people can play the games they want, virtually anywhere they want."

"For more than 30 years our incredibly talented teams have created some of the most successful games," said Bobby Kotick, CEO of Activision Blizzard.

"The combination of Activision Blizzard's world-class talent and extraordinary franchises with Microsoft's technology, distribution, access to talent, ambitious vision and shared commitment to gaming and inclusion will help ensure our continued success in an increasingly competitive industry."

Following the acquisition, Kotick and his team resume their focus on driving efforts to further strengthen the company's culture and accelerate business growth. Once the deal closes, Kotick reports to Spencer.

Microsoft - Activision Blizzard
Microsoft Gaming leadership, following the Activision Blizzard acquisition.

With over three billion people actively playing games, Microsoft also targets the 95% of all players globally who play games through their mobile devices.

With the acquisition, Microsoft and Activision Blizzard want to empower players to enjoy the most-immersive franchises, virtually anywhere they want.

On its announcement, Microsoft said that the acquisition is to bring the "joy and community of gaming to everyone, across every device."

Microsoft also wants to ramp up its Microsoft's Game Pass portfolio with plans to launch Activision Blizzard games into Game Pass, which has reached a milestone of over 25 million subscribers.

Activision Blizzard's nearly 400 million monthly active players in 190 countries is already a huge money-making business. With that in mind, the acquisition is aimed to make Game Pass one of the most compelling and diverse lineups of gaming content in the industry.

Once the deal closes, Microsoft would have 30 internal game development studios, along with additional publishing and esports production capabilities.

The deal has been approved by the boards of directors of both Microsoft and Activision Blizzard, and is expected to close in fiscal year 2023