Why did Microsoft Buy Activision?
Business News
Microsoft CEO Satya Nadella
The Activision Blizzard acquisition by Microsoft has been a figure of controversy recently, with court cases and accusations being thrown around regarding insider trading, sexual harassment and employee discrimination. Despite all that is being thrown around, this acquisition progressed and was eventually finalized in October of 2023.
Many people professed their fears regarding the acquisition prior to its finalization as they believed that it would give Microsoft, an extremely powerful and influential brand! Moreover, even more power in this growing market.
Furthermore, many worried that Microsoft would restrict availability to the games that they now own.
Thus, the right to play would only become available on platforms owned by Microsoft, such as Xbox and similar platforms. This would pose an extreme problem to many gamers as Microsoft owns a litany of games, now including Call of Duty, which has up to 100 million monthly users, and Candy Crush, which has approximately 270 million users.
The DJ Hero turntable controller, made by Activision. DJ Hero is a game that features stylized, virtual DJ-ing similar to the gameplay of Rockband and Guitar Hero. The game requires a specialized controller packaged with the game. This is a controller for the XBox 360 version of the game, and the 360 controls can become accessed under the flap on the top left. Of note is that the black unit on the left with the slider controls becomes removable and its orientation reversed, making the controller ambidextrous.
In an attempt to address this problem, Microsoft stated that they do not plan to make these games exclusively available on platforms that they own. While agreeing to not privatize the games that Microsoft now owns is something that would greatly benefit many people, ultimately it is a choice that will likely not generate as much money as if they were to make games solely available on Xbox. However owning these companies will allow Microsoft to develop new games that would be a part of these extremely lucrative franchises.
The disruption caused by online gaming, by companies such as Steam, that remove the need for a gaming console, have also caused Microsoft to branch out into new industries.
As a result, allowing Microsoft to become a dominant player in this growing industry!
This additional industry that Microsoft is now able to benefit from with the addition of all Activision Blizzard games, will greatly increase the amount of diversity for MSFT profits in the future. As this is a diversification of Microsoft’s revenue streams, they were positioning themselves to allow for sustained growth and relevance within the gaming industry.
After this merger completed, Microsoft became the third largest gaming company in the world, adding both Candy Crush and the Call of Duty games to the long list of games that it owns. In this growing market, this would strongly place Microsoft as one of the forefront companies in both the technology and gaming industries. As these markets are related to each other, new innovations made by Microsoft in the technology industry will inevitably affect the gaming industry. Both of these companies seek to benefit from this acquisition as this will allow for many of these games to reach new industries and locations through the use of hardware owned by Microsoft.
In conclusion, Microsoft acquired Activision Blizzard to strengthen its position in the gaming industry, particularly in mobile gaming and the development of metaverse platforms. Lastly, the acquisition aims to expand Microsoft’s gaming portfolio and enhance its Game Pass offerings with Activision’s popular titles.
Written by Quentin Bader
Cloud, Computers, Apps & Gaming
