Microsoft is acquiring Activision, the maker of “Call of Duty,” “World of Warcraft,” and “Candy Crush” for a record amount, putting the world’s biggest software maker at the forefront of gaming — and possibly the virtual reality metaverse.
In a buyout that dwarfs others, Microsoft announced plans today to purchase digital game development company Activision Blizzard in an all-cash deal worth $68.7 billion. If the acquisition goes through, it would significantly add to Microsoft’s already sizeable video game operation, which includes “Minecraft” and “Doom.” Activision’s stable of popular video games includes “Call of Duty,” “World of Warcraft,” and “Candy Crush” — all of which are already available through Microsoft’s Xbox console business. The deal would give Microsoft a solid foothold in the emerging metaverse industry, which blends the traditional online world with that of the virtual through augmented reality headsets. “In the end, the line between the enterprise and consumer metaverses was always going to be fuzzy, and you can’t focus on just one,” said Thomas Bittman, a vice president and distinguished analyst with Gartner Research. “Microsoft is now going big on both.” The acquisition would be Microsoft’s largest, and the biggest buyout of any gaming company, dwarfing the $12.7 billion acquisition of Zynga by Take-Two Interactive earlier this month. It’s more than double Microsoft’s next largest acquisition — its $26 billion purchase of LinkedIn in 2016. Microsoft said purchasing Activision will make it the world’s third-largest gaming company by revenue, behind China’s Tencent Holdings Ltd. and Japan’s Sony Group Corp. Lewis Ward, a research director with IDC whose coverage areas include the global video game and augmented and virtual reality (AR/VR) markets, said the deal raises concerns about too much consolidation and market concentration in the gaming space.
