The video game sector has seen this Tuesday how, totally unexpectedly, there was one of the corporate movements that will undoubtedly mark the history of this marketboth for the multi-million dollar amount of the operation and for the consequences it may have on the development of a sector with enormous growth potential.
Microsoft has announced the purchase of Activision Blizzard, one of the largest video game companies in the world, for 68.7 billion dollars (about 60,300 million euros). A figure that makes it not only the largest corporate operation in the history of the technology giant, but also the most important that has ever been carried out in the sector.
This purchase confirms the commitment that Microsoft has made in recent years to strengthen its division of gaming and give it more weight within the company’s business. And it is that its decision not to expand the resources of this unit at the beginning of the last decade caused its content creation capabilities to be reduced at that time compared to those of its competition.
To reverse this situation, the technology company has made several acquisitions in recent yearsespecially from medium-sized companies, and of which two have stood out until now: the purchase of the studio that created the popular Minecraft and that of Bethesda.
Specifically, in September 2014, Microsoft paid $2.5 billion (2,207 million euros) for taking over the Swedish studio Mojangwhich had made his Minecraft video game one of the most popular of the moment.
However, it was with the purchase of ZeniMax Media, parent company of Bethesda Softworks, with which he confirmed that his commitment to be a leader in video games was serious. Microsoft invested in September 2020 around 7,500 million dollars (6,622 million euros) in the owner of franchises such as Fallout or DOOM.
And now, just released the year 2022, Microsoft strikes the final blow with the acquisition of Activision Blizzard and Kingan operation that allows the company to be on the world podium in the video game industry, only behind Tencent Games, the Chinese giant’s games division, and Sony.
revolution in the industry
But the remarkable thing about the union of Microsoft and Activision Blizzard is not only in the size of the operation, but also in the consequences it will have for the video game marketwhere you can suppose a before and after in terms of its operation.
And it is that with Activision Blizzard within the umbrella of Microsoft, Xbox users may get access sooner than those of other platforms to some of its most popular franchises or better versions.
Even if no judicial or competition authority decision prohibits it, Microsoft platform may become exclusive provider of games like Call of Duty, a saga whose best-selling titles each year, which can be a differentiating factor when a user decides to acquire one console or another.
As with platforms streaming like Netflix, Disney+ or Amazon Prime Video, content has become a key aspect to attract and retain customers. And with the purchase of Activision Blizzard, Microsoft is granted a significant level of exclusive rights and valuable intellectual property assets.
A growing market
For all these reasons, Microsoft is called upon to play a fundamental role in a market that is valued at 200,000 million dollars (176,000 million euros) and for which all experts see enormous growth potential, the largest in the entire entertainment industry.
Currently, around 3 billion people worldwide are gamersa figure that is expected to reach 4,500 million in 2030. And the increase in players is also accompanied by an increase in supply, since in 2021 the number of launches soared by 64%.
The one with video games it is an “enormously dynamic” market in which mobile devices are gaining more and more weightLike the smartphonesand that it will be a key element within the platforms that are developed around one of the most fashionable concepts in the digital world today: the metaverse.
To compete in this promising environment, Microsoft adds with this acquisition almost 10,000 workers and 30 new studios that develop games as popular as Warcraft, Diablo, Overwatch, Call of Duty, Halo and Candy Crush. A wide variety of titles that prevents the company from being dependent on a single successful product, providing greater stability and visibility to your business.
a solid company
Activision Blizzard is not a risky investment for Microsoft, nor is it a commitment to a booming company, as Skype or Microsoft could have been at the time. On the contrary, is a listed company, solid, with a long history and a broad product portfolio in the market.
In fact, its origins date back to 1979, many years before the appearance of giants like Nintendo and Sega, since around that time Activision became in the first independent company to create video games for Atari.
The company expects to close the 2021 financial year with revenues of 8,660 million dollars (7,643 million euros), which is 7.1% more than the 8,086 million dollars (7,136 million euros) that it invoiced in 2020.
Also, has been paying cash dividends to its shareholders for more than a decade. The last of them, of 0.47 euros per share, was paid on May 6, 2021 and represented an increase of 15% compared to 0.41 euros in 2020.
The Activision Blizzard shares have reacted euphorically to the $95 per share offer presented by Microsoft, which supposes a premium of 45% with respect to the closing price on Friday. Specifically, during the day on Tuesday they have registered increases of around 30%.
An optimism that has also been infected by another large company in the market, Electronic Arts (EA), whose titles have risen by 9%. On the contrary, Microsoft shares have moved throughout the day with falls of between 1% and 2%.