Microsoft invests billions in gaming to become a metaverse superpower
Microsoft is acquiring gaming company Activision Blizzard for $68.7 billion dollars, strengthening their gaming branch, with an eye towards the metaverse.
“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 of Microsoft.
Globally today, 3 billion people play games, a market that is expected to grow to 4.5 billion by 2030, creating a $200+ billion gaming industry, which is the largest and fastest-growing form of entertainment; In 2021 alone, the total number of video game releases was up 64% compared to 2020 and 51% of players in the U.S. reported spending more than 7 hours per week playing across console, PC and mobile.
With this acquisition, Microsoft is becoming world’s third biggest gaming company, in terms of revenue, behind Tencent and Sony. The acquisition brings to Microsoft franchises like “Warcraft,” “Diablo,” “Overwatch,” “Call of Duty” and “Candy Crush,” in addition to global eSports activities through Major League Gaming.
Mobile is the largest segment in gaming, with nearly 95% of all players globally enjoying games on mobile and Activision Blizzard’s mobile business represents a significant presence and opportunity for Microsoft in this fast-growing segment, given that Microsoft’s mobile presence is problematic.
Microsoft will also include Activision Blizzard games into its Game Pass porotofolio, which has over 25 million subscribers. Activision Blizzard has approximately 400 million monthly active players in 190 countries and three billion-dollar franchises.
Early in 2021, the European Commission had approved a $7.5 billion acquisition of ZeniMax Media Inc. by Microsoft Corporation, a deal that increased Microsoft’s list of first-party studios to 23, following the addition of Bethesda sub-studios like Dishonored developer Arkane, Wolfenstein studio MachineGames, Doom maker id Software, and The Evil Within studio Tango Gameworks.
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