Samuel Case, FISM News
Microsoft announced yesterday that it had reached a deal to buy Activision Blizzard, the game studio behind the Call of Duty franchise and World of Warcraft. The near $69 billion price tag makes the all-cash acquisition the largest on record for Microsoft and the biggest deal in the history of the gaming industry.
The deal comes as Activsion has been suffering from a public image meltdown following numerous allegations of sexual harassment and misconduct by several top managers. Activision has fired or removed over three dozen employees amidst the allegations and disciplined another 40. Despite the scandals, the company’s current CEO, Bobby Kotic, will keep his position with Activision, although he is expected to depart soon after its completion.
Meanwhile, consumer reaction has been mixed. Some have praised the deal as means of rehabilitating the damaged company. The deal will also add Activision’s library of games to the Xbox Game Pass, which functions almost like a streaming service for video games, where users pay a fixed monthly rate to access a large selection of titles which can be downloaded at any time.
Others have been critical of the deal, seeing it is part of recent trend of Microsoft purchasing popular studios, whose titles have previously been on multiple platforms. These critics would rather the company use its same financial resources to develop Xbox original titles. Last March Microsoft completed its acquisition of the popular third-party developer Bethesda for $7.5 billion dollars.
At the time of that acquisition Microsoft Gaming CEO Phil Spencer had indicated that future Bethesda titles may still be available on other platforms, such as Sony’s PlayStation, saying, “We have games that exist on other platforms, and we’re gonna go support those games on the platforms they’re on. There’s communities of players and we love those communities, and we’ll continue to invest in them.”
Following Spencer’s comments, however, it was soon announced that the much-anticipated Bethesda title Starfield would be exclusive to Xbox and PC.
All eyes now turn to industry rival Sony, which historically has been the gaming market leader. The PlayStation developer has already been struggling to keep up with demand for its PS5 console because of a global microchip shortage. Sony has attempted to keep consumers within its PlayStation ecosystem by extending the market lifespan of its previous console, the PS4.
Consumers now speculate whether PlayStation will be forced to engage in a similar strategy of buying smaller developers, such as the French developer Ubisoft. However, a true war of attrition may be difficult for Sony to maintain, considering the vast disparity between its capital and Microsoft’s.