Microsoft acquiring Activision Blizzard in $68.7B gaming deal
Software giant Microsoft has agreed to purchase Activision Blizzard, a major acquisition valued at $68.7 billion that combines many major studios under one entity.
Announced on Tuesday, the deal with see Microsoft acquire Activision Blizzard for $95 per share in an all-cash transaction. The $68.7 billion valuation is inclusive of Activision Blizzard's net cash.
Once completed, the acquisition will turn Microsoft into the world's third-largest gaming company by revenue, behind Tencent and Sony. Bobby Kotik will continue to operate as CEO of Activision Blizzard, and will report to Microsoft Gaming CEO Phil Spencer.
The purchase will see Microsoft take ownership of many Activision, Blizzard, and King studio franchises, including "Warcraft," "Diablo," "Overwatch," "Call of Duty," and "Candy Crush."
"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, 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."
Activision Blizzard's support for the Mac has waxed and waned over the years. Historically, Blizzard by itself had better support for macOS than Activision Blizzard does. Obviously, the King properties that are part of the deal like "Candy Crush" are well supported on iOS and iPadOS.
Microsoft says that it will use the catalog to bolster its GamePass offering. One aspect of Gamepass, its Xbox Cloud Gaming service (previously known as xCloud), is available on iPhone and iPad through Safari.
GamePass currently has over 25 million subscribers. As Activision Blizzard has nearly 400 million active players in over 190 countries, this could give Microsoft a considerable subscriber bump down the road.
The announced deal follows after a similar consolidation between gaming companies. On January 10, Take-Two Interactive announced a $12.7 billion deal to acquire mobile gaming giant Zynga.
Activision Blizzard is also in the midst of a scandal over a culture of sexual harassment and misconduct within the company.
The deal is not certain, as it needs to pass regulatory review and approval from Activision Blizzard's shareholders. It has already been approved by the boards of directors for both Microsoft and Activision Blizzard.
In pre-market trading, Activision Blizzard stock jumped to just less than $90.
If it goes through, the transaction is anticipated to close in the 2023 fiscal year. However, if it fails to pass, Microsoft faces paying a "break-up" fee of around $3 billion. The deal is likely to face opposition by the US Government, given its stance over the last two years regarding big tech acquisitions and consolidations.
Read on AppleInsider
Announced on Tuesday, the deal with see Microsoft acquire Activision Blizzard for $95 per share in an all-cash transaction. The $68.7 billion valuation is inclusive of Activision Blizzard's net cash.
Once completed, the acquisition will turn Microsoft into the world's third-largest gaming company by revenue, behind Tencent and Sony. Bobby Kotik will continue to operate as CEO of Activision Blizzard, and will report to Microsoft Gaming CEO Phil Spencer.
The purchase will see Microsoft take ownership of many Activision, Blizzard, and King studio franchises, including "Warcraft," "Diablo," "Overwatch," "Call of Duty," and "Candy Crush."
"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, 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."
Activision Blizzard's support for the Mac has waxed and waned over the years. Historically, Blizzard by itself had better support for macOS than Activision Blizzard does. Obviously, the King properties that are part of the deal like "Candy Crush" are well supported on iOS and iPadOS.
Microsoft says that it will use the catalog to bolster its GamePass offering. One aspect of Gamepass, its Xbox Cloud Gaming service (previously known as xCloud), is available on iPhone and iPad through Safari.
GamePass currently has over 25 million subscribers. As Activision Blizzard has nearly 400 million active players in over 190 countries, this could give Microsoft a considerable subscriber bump down the road.
The announced deal follows after a similar consolidation between gaming companies. On January 10, Take-Two Interactive announced a $12.7 billion deal to acquire mobile gaming giant Zynga.
Activision Blizzard is also in the midst of a scandal over a culture of sexual harassment and misconduct within the company.
The deal is not certain, as it needs to pass regulatory review and approval from Activision Blizzard's shareholders. It has already been approved by the boards of directors for both Microsoft and Activision Blizzard.
In pre-market trading, Activision Blizzard stock jumped to just less than $90.
If it goes through, the transaction is anticipated to close in the 2023 fiscal year. However, if it fails to pass, Microsoft faces paying a "break-up" fee of around $3 billion. The deal is likely to face opposition by the US Government, given its stance over the last two years regarding big tech acquisitions and consolidations.
Read on AppleInsider
Comments
Microsoft has a horrible M&A record. It is where company’s go to die
Umm, maybe because they'd like a slice of that business. Just sayin'.
Not saying that Apple should have allowed game streaming apps into their app store. But the idea "who cares: game streaming isn't going to catch on anyway" was a very bad take. If Microsoft wasn't happy with the initial response to xCloud, there is no way that they would have doubled down by spending $70 billion on Activision Blizzard. And no, the antitrust types aren't going to block it.
The only path into AAA gaming for Apple is to emulate Microsoft and create their own gaming console. The problem: the AAA console gaming market is in turmoil right now, which is precisely what Microsoft is taking advantage of by snapping up beleagured studios left and right. And - as I mentioned above - currently if you combine the efforts of Microsoft, Nvidia, Google and Amazon and you have 42-45 million cloud gaming subscriptions. It would take Apple 3 years at minimum to launch a console gaming platform; who knows how many cloud gaming subscribers there will be in that time.
Apple will receive all retro games on Apple TV.
So, funny tho how Microsoft is such a Gaming Whore Ecosystem. But that's 99% of what their customers want.
And I don't care how many people lie to themselves (baby don't look, back baby don't back, or whatever). give me a break!
It's practically impossible to work 99% FULLY unhindered without aggravating my GUT on a Windows machine...
Where on macOS it's non-stop keep doing no stopping what I want to do!
My main concern is future mac support. iOS marketshare is big enough and microsoft doesnt have its own mobile platform, but its not the case with mac and windows/xbox. Historically blizzard has been pretty good with using new technologies like metal, the new M1… and we know how bad Microsofts trackrecord has been when it comes to apps for the mac. They were the last big developer to go native with intel if i remember right…
The announcemenet of gamepass inclusion is also concerning. Changing playerbase has its own effects on games, not to mention possible forced xbox implementations…
I really hope they wont ruin a reliable mac developer and some awesome games in the long run.
The main point of Microsoft acquiring large portfolios of popular videogame IP is to increase interest in the Xbox Game Pass and grow the subscriber base. This is actually covered in the AI article. Game Pass is recurring revenue and since you haven't noticed, subscriptions are actually a thing these days.
So yes, future versions of the Call Of Duty franchise, Diablo IV and Overwatch 3 may end up being Windows PC/Xbox exclusives.
A. Office 365 is their most popular SaaS offering by a mile
B. though they increasingly heavily use Linux, Windows is one of their most popular IaaS offerings (as well as being a major IaaS product for Google, Amazon and Nvidia to the point that both Amazon Luna and Nvidia GeForce Now use it for video game streaming)
Yes, Azure is the #2 cloud provider to Amazon AWS, but put Azure in a position to have to pay exhorbitant fees to license Office 365 and Windows like everybody else and what advantage would they have?
Incidentally, you greatly overstate the number of Apple TV boxes in the wild. Apple TV is behind Roku, Tizen, Fire TV, lgOS and Android TV/Google TV and it isn't close. If it were, you would have more developers for Apple Arcade. The reason why Apple Arcade didn't take off is because it is between a rock and a hard place. Apple wants the combination of iPhone, iPad and Apple TV to push at least PS4-caliber games. (Whether the Apple TV is even capable of 4K games at high refresh rates is debatable. It is likely capable of either 1080p games at high refresh rates or 4K games at low ones.)
Two problems.
1. There is no evidence that AAA gamers want PS4-caliber games. They want the latest games running at the most powerful specs, which means 8K with ray tracing etc.
2. iPad/iPhone gaming is primarily touchscreen. Apple TV requires controllers. The largest audience of gamers - by far - is iPad but the AAA gaming experience requires targeting the device with a very small market share (Apple TV) with the ideal version of the game while still making the iPad and iPhone versions high quality. That is a challenge that AAA developers for no other platform but Nintendo have to worry about, and again Nintendo's partners have been developing games for the DS and Gameboy for decades.
And for the reasons that I have stated, no this shouldn't be Apple. Apple doesn't have a platform capable of running Activision Blizzard games. Microsoft has two of them: Windows and PlayStation. And no, buying Activision Blizzard won't cause a stampede of people to run out and buy MacBook Airs or Apple TVs to game on because that is still just one content library from one studio. It would be the equivalent of - for example - Amazon trying to build a streaming service with only the MGM library.