Microsoft Acquires Activision Blizzard For $68.7 billion

Published on 19 Jan 2022

Microsoft has acquired the video game heavyweights Call of Duty and World of Warcraft. The company states that it would purchase Activision Blizzard, the publisher of Call of Duty, among the most popular video games in the United States, and numerous other titles such as Overwatch, World of Warcraft, and Candy Crush.

Satya Nadella, CEO of Microsoft, said that the transaction would boost the company's development into the metaverse. For customers, the arrangement may mean that one of gaming's most popular franchises would be accessible only on PC or Xbox.

"Gaming is the most dynamic and interesting category of entertainment available today across all platforms and will play a significant role in the growth of metaverse platforms," Nadella said in a statement. "We're investing heavily in world-class content, community, and the cloud to usher in a new age of gaming that prioritizes players and creators and ensures that gaming is safe, inclusive, and accessible to everyone."

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About The Purchase

Microsoft will purchase Activision Blizzard for $68.7 billion in an all-cash transaction.

The revelation comes on the heels of November reports that Microsoft was reconsidering its partnership with the video game publisher in the wake of accusations that Activision Blizzard CEO Bobby Kotick was aware of sexual misconduct charges at the firm for years.

California sued Activision Blizzard last year, alleging that the firm maintained a sexist atmosphere and underpaid women despite the increased effort.

Employees at Activision Blizzard staged walkouts to call for Kotick's removal from the company's senior executive position and cultural improvements.

Microsoft said in its statement that Kotick would continue as publisher's CEO, reporting to Phil Spencer, director of Microsoft Gaming.

How Does This Affect Consumers?

According to Wedbush analyst Michael Pachter, the transaction is detrimental to Sony, which manufactures the PlayStation 5 video gaming system.

"One of these days, you're very likely going to lose Call of Duty on PlayStation," Pachter said.

As per the NPD Group, Call of Duty has been the best-selling video game series for 13 consecutive years in recorded dollar sales.

"As a customer now, right now, are you considering purchasing a PS5 for the sole purpose of playing Call of Duty? Would you reconsider? That is the issue," Pachter said.

This prospect might become a source of contention for regulators, who could either reject the acquisition or compel Microsoft to agree to keep Call of Duty games available on rival platforms for an extended length of time, Pachter said.

Meanwhile, the acquisition adds more video games to Microsoft's burgeoning Xbox Game Pass subscription service, akin to Netflix. It allows gamers to access dozens of titles for a monthly charge. Microsoft paid $7.5 billion in March to purchase ZeniMax Media, which owns Bethesda Game Studios and brands such as Fallout and The Elder Scrolls.

Bethesda's next major release, the open-world adventure Starfield, is scheduled for November release for PC and Xbox. The partnership might result in Game Pass customers receiving early access to upcoming Activision Blizzard titles.

Microsoft's Relationship With The Metaverse

Microsoft has teamed up with other firms, including Meta and Fortnite makers Epic Games, to carve out a niche in the metaverse. This virtual realm, proponents say, could eventually replace the present internet.

Microsoft has experimented with this universe's aspects via its world-building game Minecraft and through augmented and virtual reality technologies. Rupantar Guha, the chief analyst at GlobalData, said that this transaction would help Microsoft establish itself as a leader in the metaverse.

"Activision's games will assist Microsoft in developing metaverse experiences and will give a well-established worldwide customer base for testing and marketing," Guha said.


Featured image: Technology photo created by DCStudio -


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