Microsoft is acquiring Activision, publisher of Call of Duty, World of Warcraft, and Diablo. The deal will be worth $68.7 billion, well over the $26 billion Microsoft paid to acquire LinkedIn in 2016. This is Microsoft’s largest acquisition in gaming, and the company says that after the deal, Activision will become the third-largest gaming company in terms of revenue, behind Sony and Tencent.
Microsoft plans to add many of Activision’s games to Xbox Game Pass after the deal ends. With the acquisition of Activision, Microsoft will soon release franchises like Warcraft, Diablo, Overwatch, Call of Duty, and Candy Crush.
Phil Spencer, Microsoft’s CEO of games, made the following comments;
“Upon close, we will offer as many Activision Blizzard games as we can within Xbox Game Pass and PC Game Pass, both new titles and games from Activision Blizzard’s incredible catalog.”
Xbox Game Pass has reached 25 million subscribers, while Microsoft continues to buy studios to improve its subscription service.
After the deal is complete and the transition period to Microsoft, the Company’s CEO, Bobby Kotick, will not maintain his position due to the allegations of harassment in the past. Phil Spencer, formerly head of games at Microsoft, is now CEO of Microsoft Gaming, and the company states that the Activision Blizzard business will be reported directly to Spencer.
Phil Spencer, Microsoft’s CEO of games, continued his speech with the following words;
“As a company, Microsoft is committed to the journey of being involved in every aspect of the game among both employees and gamers. We deeply value individual studio cultures. We also believe that creative success and autonomy go hand in hand with treating every person with dignity and respect. We make this commitment to all teams and all leaders. We look forward to expanding our proactive engagement culture to include the great teams at Activision Blizzard.”
Microsoft’s massive Activision Blizzard deal comes nearly a year after buying Bethesda (ZeniMax Media) for $7.5 billion. The past Bethesda deal brought the company’s Xbox game studios to 23 and was seen as a big boost for Xbox Game Pass.
Microsoft now expects the Activision Blizzard deal to be completed in fiscal 2023, meaning the agreement may not be ratified for up to 18 months. That’s a long time to complete a bargain, but Activision Blizzard operates in many markets that could complicate things for Microsoft.