It would be the biggest tech deal in history: Microsoft wants to be a gaming giant with mega takeover

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Deadline is July 18: Microsoft wants to buy game company Activision Blizzard. $69 billion! The technology company based in Redmond (USA) announced the acquisition at the beginning of last year. This was followed by several months of war against antitrust authorities. Mega deal now in the last few meters?

With the acquisition, Microsoft is catching big fish like the multi-billion dollar “Call of Duty” series or the online role-playing game “World of Warcraft”. However, the hidden treasure and one of the main reasons for the takeover is the mobile game “Candy Crush Saga”, which has about a billion players. Microsoft has quickly become a major player in the mobile games market.

The world’s largest entertainment industry

Additionally, the takeover is also considered an investment in the virtual metaverse. When the deal was announced in early 2022, Microsoft CEO Satya Nadella (55) said that “gaming has played an important role in the development of Metaverse platforms.” Activision Blizzard’s record total could therefore also be seen as a declaration of war towards the Zuckerberg group Meta.

It’s also about staying connected to the summit: In the gaming market, Xbox group Microsoft, with annual sales of US$ 16.3 billion, is eclipsed by PlayStation manufacturer Sony, with annual sales of US$ 28.3 billion, almost twice the turnover of the world. more. The gaming industry is the unnoticed giant of the entertainment industry: it now generates nearly three times more revenue worldwide than the film and music industries combined.

Concerned about antitrust authorities and competition

Antitrust officials in the US and Europe fear the takeover will lead to a monopoly. Because Microsoft is a console manufacturer, game developer, and provider of game subscription models.

Meanwhile, rival Sony has revealed to the American court how dependent it is on revenue from the Japanese group’s “Call of Duty” game franchise. Just last Sunday, Sony was appeased: the group signed a deal with Microsoft. This makes the first-person shooter game also appear on Playstation in the next decade. Microsoft has already signed similar contracts with other console vendors like Nintendo.

The so-called cloud gaming also plays an important role. The term describes a new industry where games are no longer installed on a console or PC, but streamed directly over the Internet.

Only Great Britain still blocks

In this still very small market, Microsoft is number one with «Xcloud». European antitrust officials, the US FTC and British competition watchdog CMA saw the takeover as a threat to free competition for cloud gaming. Because Nvidia, the video card manufacturer, which is Microsoft’s biggest competitor, does not develop any games itself.

Competition officials argue that the competitiveness of Nvidia’s cloud gaming platform, Geforce Now, will be further restricted. The EU gave the green light after Microsoft agreed to offer its games on a contractual basis for Geforce Now and other cloud game providers for the next ten years.

Contrary to the efforts of the FTC, the American Court of Appeals was finally convinced by concessions. The takeover was still blocked only in Great Britain: the CMA surprisingly delayed the decision date from July 18 to August 29.

Minor changes thanks to concessions

The deal may be delayed again, even if the exchange is already preparing to take over. It is also quite possible that Microsoft will temporarily withdraw from the UK market before the deal can be completed.

Meanwhile, little has changed for consumers due to many concessions. The deal also offers some unexpected benefits for gamers: Microsoft’s gaming subscription service, Game Pass, will soon see a lot of growth thanks to the takeover. And thanks to the concerns of competition officials, the cloud gaming range will also expand drastically in the coming months.

Source :Blick