Foresight: Microsoft is buying Activision Blizzard in what would be the company’s biggest acquisition yet. Valued at $68.7 billion, the deal will likely change the video game landscape and make Microsoft the third largest video game company in the world.
Microsoft today announcement it acquires Activision Blizzard, the well-known video game publisher behind franchises like Call of Duty, Warcraft, Diablo, Candy Crush and Hearthstone. The all-cash deal is valued at $68.7 billion, making it the largest acquisition in the company’s history.
Previously, Microsoft bought LinkedIn in 2016 for $26.2 billion and last year paid $19.7 billion for Nuance Communications. As part of the deal, Microsoft will get Activision Blizzard’s nearly 10,000 employees and likely become the third most valuable video game company behind giants Tencent and Sony. It will also expand its esports publishing and production capabilities to a total of 30 in-house game development studios.
In addition to inheriting all intellectual property and development resources, Microsoft plans to add Activision’s roster of games to Xbox Game Pass once the deal closes.
Xbox Game Pass has grown to 25 million subscribers, a nice increase from the 18 million he reported in January last year. In 2021, Xbox Game Pass added 20 Bethesda titles to its catalog, and now that catalog is growing with several popular titles that have a combined 400 million active players in 190 countries.
Activision Blizzard has come under extensive legal and public pressure in recent months over allegations of sexual misconduct and unfair compensation for temporary workers.
Microsoft has yet to reveal how it will address these concerns, but in the meantime Bobby Kotick will continue as CEO of Activision Blizzard. Once the deal is done, the Activision Blizzard business will report directly to Microsoft Gaming CEO Phil Spencer, which seems to suggest he might not stay after that.
Microsoft Gaming is a new division that will tackle the company’s gaming ambitions across Xbox, PC, mobile and the cloud. CEO Satya Nadella said in a statement that “we are investing deeply in world-class content, community and cloud to usher in a new era of gaming that puts players and creators first and makes gaming safe, inclusive and secure. accessible to everyone”.
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