Microsoft is acquiring Activision Blizzard in shocking deal

By DeAngelo Epps January 18, 2022

After months of controversial news surrounding Activision Blizzard, Microsoft has stepped in and acquired the company. As announced in an official press release from Xbox chief Phil Spencer, Microsoft plans to buy the company behind franchises like World of Warcraft, Diablo, Overwatch, Call of Duty, and more.

“This acquisition will accelerate the growth in Microsoft’s gaming business across mobile, PC, console, and cloud and will provide building blocks for the metaverse,” Microsoft states in the release.

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The deal is rumored to be valued at $68.7 billion. If accurate, that would make it the largest acquisition in video game history by a significant margin. The record was just set by Take Two when it announced intentions to acquire Zynga for $12.7 billion.

Microsoft already made its immediate plans concerning Activision Blizzard apparent, confirming that it will offer as many new and old Activision Blizzard games as it can within Xbox Game Pass and PC Game Pass. It also said that the acquisition of Activision Blizzard’s franchises will accelerate its plans for Cloud Gaming and will continue to be able to be enjoyed on a variety of platforms.

This is Microsoft’s second big acquisition after the company bought Bethesda in 2021. It also makes Microsoft the world’s third-largest gaming company by revenue, behind Tencent and Sony.

In terms of the controversial storm that Microsoft has to deal with over this acquisition, the company states: “We deeply value individual studio cultures. We also believe that creative success and autonomy go hand in hand with treating every person with dignity and respect. We hold all teams, and all leaders, to this commitment. We’re looking forward to extending our culture of proactive inclusion to the great teams across Activision Blizzard.”

Microsoft also confirms that the acquisition isn’t quite finished just yet. Until this transaction closes at an undisclosed time, Activision Blizzard and Microsoft Gaming will continue to operate independently.

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Microsoft’s Activision Blizzard acquisition just hit another hurdle in the U.K.

Microsoft's nearly $70 billion acquisition of Activision Blizzard is under review internationally, and no country takes this matter more seriously than the United Kingdom. The Competition and Markets Authority (CMA) completed the first phase of its investigation into the deal and is now recommending putting it through a second phase.

The call for extra scrutiny into the deal between Microsoft and Activision Blizzard stems from the CMA's concern that such a deal may substantially stifle competition in the U.K.'s gaming market. Specifically, it's worried that if and when the merger goes through, Microsoft may make Activision Blizzard's portfolio of games exclusive to Xbox consoles, or make them available on PlayStation and Nintendo systems "on worse terms." It's also concerned that the company may leverage Activision Blizzard's games across console, PC, and cloud systems to harm competition in the growing cloud gaming space.

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Call of Duty will come to Game Pass and stay on PlayStation, Microsoft says

New Operators in watch tower in Call of Duty: Warzone.

CEO of Microsoft Gaming Phil Spencer has confirmed that future Call of Duty titles will be part of Game Pass, but still come to PlayStation on the same day of release.

As the purchase of publisher Activision Blizzard by Microsoft continues forward, more details regarding how the new catalog of IP that Xbox will inherit will be handled are coming to light. The most notable part of the deal in the console space concerns the massive Call of Duty franchise, which has been a mainstay on bestselling games lists for over a decade straight. Sony previously had the marketing rights to the series before the purchase was set in motion, and recently made statements arguing that Xbox making the series exclusive would influence console purchasing decisions.

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PlayStation and Xbox are betting big on mobile, and for good reason

The Backbone One - PlayStation Edition has a phone in it.

Sony surprised PlayStation fans August 29 when it acquired Savage Game Studios, a mobile game developer. As part of this announcement, Head of PlayStation Studios Hermen Hulst unveiled the company's new PlayStation Studios Mobile Division that "will operate independently from our console development and focus on innovative, on-the-go experiences based on new and existing PlayStation IP." The news comes in the wake of the Backbone One -- PlayStation Edition's launch and Microsoft's Activision Blizzard acquisition that will also bring Candy Crush developer King and Blizzard mobile games into Xbox Game Studios. It's clear that the big console players are investing more than ever in mobile.
That might sound like a shocking development, especially for hardcore console and PC players who aren't fans of mobile games for various reasons, including predatory monetization practices. But when you take a step back and look at the reality of mobile gaming, it's entirely clear why two of the biggest names in console gaming want to spread their reach to an even more global and lucrative market -- especially as overseas markets further embrace mobile as a gaming platform of choice.
Finding their knack for mobile
Focusing on console and PC gaming makes it easy to forget just how big mobile gaming is. After Microsoft's announcement of the Activision Blizzard acquisition, Omdia Principal Analyst George Jijiashvili told Digital Trends that while consumer spending on PC and console gaming is predicted to reach $62 billion this year, mobile game players will spend $111 billion overall in 2022. "If we look at our forecast for 2025, we expect the spend on console and PC games to remain relatively flat," Jijiashvili said. "However, mobile gaming is set to grow considerably." Jijiashvili's estimations also don't even consider cloud gaming, which is prevalent on mobile and is expected to grow in the coming years.

Jijiashvili highlighted that console gaming would stay healthy but somewhat stagnant as players from previous generations upgrade to PS5 and Xbox Series X. Meanwhile, he says PC gaming is falling out of favor in Asia, highlighting that a game like PUBG sees most resources assigned to the mobile game before they come over to the PC and console versions. Before the Activision Blizzard acquisition, Jijiashvili believed Xbox "desperately lacked" a strong foothold in the mobile gaming market, and it's easy for us to see that the same currently applies to PlayStation prior to the Savage Game Studios acquisition. For how important PlayStation and Xbox were to console players, companies like King and Zynga meant much more to mobile gamers for a long time.
On top of that, mobile gaming also expands these game companies' reach to an even bigger audience. Yes, over 20 million PS5 and 117 million PS4 consoles are out there, but especially in Asian markets, mobile games will give PlayStation and Xbox much more exposure. Of course, Jijiashvili points out that just having mobile studios doesn't immediately guarantee success, as Asian mobile players favor "more hardcore games from the battle royale and MOBA genres, which have achieved great popularity and deliver strong performance." Still, Xbox and PlayStation will soon have a stronger foothold than ever on platforms and in regions where gamers playing on PC or console isn't as prevalent.
It's worth noting that both Xbox and PlayStation do have some history on mobile -- just not very successful ones. Microsoft had Windows Phones, tried to shove SmartGlass features into early Xbox One exclusives, and is currently making great strides in console gaming via the cloud on mobile. Meanwhile, PlayStation franchises like Uncharted, LittleBigPlanet, and even Knack (Knack's Quest, ladies and gentlemen) got mobile games under the "PlayStation Mobile" banner in the 2010s. These acquisitions showed renewed interest in developing games exclusively made for mobile. While we can't predict Microsoft's long-term plans for King as the Activision Blizzard deal still isn't finished, Hulst made Savage Game Studios' position within PlayStation Studios very clear.