Microsoft takes a major step towards video-game domination with Activision Blizzard deal
Tech giant Microsoft is looking to solidify its hold on the video game industry with a high-stakes bid for heavyweight company Activision Blizzard. The company that Bill Gates built has put forth a US$68.7 billion offer to buy the Santa Monica-based gaming company. Activision-developed titles include the high-profile likes of Overwatch, Warcraft, Candy Crush, and Call of Duty.
The deal gives Microsoft the opportunity to expand its gaming footprint on PC, consoles, and mobile devices, as well as position itself a true video games behemoth. Where consoles once ruled today’s biggest video games are mostly on smartphones. That makes major players like Microsoft determined to get into the mobile space. The deal will also help boost interest in its Xbox Game Pass subscription platform.
In a statement, Microsoft CEO Satya Nadella said “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.”
Reading into that statement, the word “inclusive” is important.
Over the past year Activision Blizzard, which has over 10,000 employees spread in studios across the globe, has been hit with repeated accusation that it’s work-place is toxic. That, along with accusations of sexual harassment, has led employees to walk out while demanding change.
Still, Activision Blizzard remains a gaming powerhouse which has over 400 million players worldwide playing its titles each month.
In the wake of those allegations, California state agency filed a sexual bias lawsuit against Activision, which it deemed as doing little to deal with a “frat boy culture. The company’s handling of various allegations later led to an investigation from the U.S. Securities and Exchange Commission.
According to insiders, action taken by Activision Blizzard has included either firing or pushed out over three-dozen employees, as well as disciplining a reported 40 others.
The deal, which is expected to close next year, would make Tech giant Microsoft the third biggest gaming company in the world. Microsoft recently spent US$7.5 billion US to acquire ZeniMax Media’s Bethesda Softworks, which has brought the world video games such as the Elder Scrolls, Doom and Fallout.
As reflected by the price tag, the Activision Blizzard deal is a more high-stakes transaction.
“Gaming has been key to Microsoft since our earliest days as a company,” Nadella stated. “Today, it’s the largest and fastest-growing form of entertainment, and as the digital and physical worlds come together, it will play a critical role in the development of metaverse platforms.”