Microsoft’s $68.7 billion, all cash deal for Activision Blizzard, one of the world’s largest video game publishers, could be an epoch-defining, Bob Iger-style land grab for C.E.O. Satya Nadella, rivaling Disney’s $71 billion deal for Fox. Gaming, after all, is under growing pressure to consolidate as the pressure to scale in a direct-to-consumer subscription market puts a premium on marketable I.P. assets. Microsoft, despite its incredible market capitalization, doesn’t actually turn a profit on its Xbox console hardware. And Activision, whose stock price collapsed amid a sexual harassment scandal, presented a ripe acquisition target. The company’s embattled C.E.O., Bobby Kotick, is expected to step down after the deal closes, ending the fevered speculation over Kotick’s fate at the company.
As a media strategy analyst, however, the Microsoft-Activision deal raises as many questions as it answers. First, what does it mean for the hundreds of millions of people who play Activision Blizzard games (World of Warcraft, Call of Duty, and Overwatch, to name a few) on Sony’s PlayStation or P.C.s? Microsoft, which owns the Xbox console system, would presumably love to leverage Activision’s beloved I.P. to create new titles that are exclusive to its platforms. Second, and most unsettled, will Joe Biden’s Department of Justice shut all this down?
Visit Puck to read this article.
