To the Metaverse and Beyond - Microsoft to acquire Activision Blizzard
On January 18, Microsoft announced that it will acquire Activision Blizzard for $68.7 billion. In the announcement, Microsoft clearly emphasized the purpose of this acquisition, illustrating that this largest bill in the company's history is aimed at the metaverse.
Games are now the largest and fastest-growing form of entertainment. The acquisition will accelerate the growth of Microsoft's gaming business in various platforms and provide the foundation for its further development of the metaverse. Microsoft plans to acquire Activision, Blizzard and a rage of classical games made by King studios like “Warcraft”, “Diablo”, “Overwatch”, “Call of Duty” and “Candy Crush”, as well as global eSports activities through Major League Gaming. The transaction, which is expected to be finished in fiscal year 2023, has been approved by the boards of Microsoft and Activision Blizzard and will make Microsoft become the third-largest gaming giant in the world.
“Gaming is the most dynamic and exciting category in entertainment across all platforms today and will play a key role in the development of the metaverse platforms,” said Satya Nadella, chairman and CEO, Microsoft. “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.”
At present, Metaverse has become a hot spot in the field of global science and technology. It is originated from Neal Stephenson's science fiction "Snow Crash", which depicts a virtual reality world. In the field of technology, a number of companies have embarked on an arms race in the metaverse. Roblox is listed on the New York Stock Exchange in 2021 as the first company aimed at the metaverse concepts. ByteDance acquired Pico, a start-up in VR. In October, Facebook announced that it will change its name to Meta and will further develop virtual reality. In games, the anchor of this concept is to create a virtual world parallel to the real world by using technological devices to bring users an immersive experience. The CEO of Roblox, Dave Baszucki believes that there are eight features of the metaverse, which are identity, friends, immersive, low friction, variety, anywhere, economy and civility. The science fiction film Ready Player One has demonstrated us a typical metaverse world with the application of these characteristics.
For Microsoft, the acquisition of Blizzard is a positioning in the metaverse market in the face of further competition in the technology sector. The game industry is an important application area for the metaverse concept, and Blizzard, as an old-established company and giant in gaming, has nearly 400 million monthly active users. By acquiring it, Microsoft can further exploit the value of Blizzard's well-known IPs, increase Microsoft's market share in the global gaming business, and give Microsoft a full entry into the meta-universe. For Blizzard, previous negative news about gender scandals and discriminatory culture has influenced its company image and consumer’s confidence. The continuous departure of key employees and the suspending of its development and publicity of several important projects also increase the negative voice of the company’s development. Microsoft’s acquisition is undoubtedly a timely help. Therefore, this acquisition seems to be a reasonable deal for both Activision Blizzard and Microsoft. Before this acquisition, Microsoft has kept laying out its gaming business. In September 2014, Mojang was acquired by it with $2.5 billion. In September 2020, Microsoft acquired Zenimax by $7.5 billion. Over the last 16 years, over ten gaming companies has been acquired by it accumulatively. In the future, with Microsoft’s brand influence and Activision Blizzard’s products, we are looking forward to seeing more immersive games brought by this acquisition.