Since the start of 2022, Microsoft and Activision Blizzard King have been unleashing passions with this $69 billion soap opera full of colossal challenges and twists and turns that we will try to decipher here for you.
It must be said that this is a truly historic operation in the video game industry, supported only by another significant takeover on the part of Microsoft, that of Bethesda Softworks and all of its studios. Activision Blizzard King is such a colossal company that many obstacles have stood in the way of the Redmond company. However, everything suggests that the takeover will soon be fully formalized, not without sacrifices.
Recall of facts
It was in January 2022 that this incredible soap opera began, when Microsoft announced to everyone’s surprise that it had negotiated the acquisition of Activision Blizzard King for the tidy sum of 69 billion dollars. A double surprise, since the American giant had then very recently absorbed another big name in the industry in the person of Bethesda Softworks, for the more “modest” sum of 7.5 billion dollars.
As with this other historic takeover, Microsoft’s initiative was clearly not to the liking of competition authorities around the world. Among the most influential entities that can block the takeover, we have the American FTC, which has filed a lawsuit in this regard, the European Commission and the British CMA.
These vehement objections were going to draw a real way of the cross for Microsoft, which however did not budge, as the game is worth the candle.
A considerable strike force at the service of Microsoft…
In the current video game landscape, Activision Blizzard King represents one of the biggest behemoths in the industry, with an extremely lucrative colossal catalog. At the top of the list, of course, we have call of dutya real money machine generating millions of dollars each year thanks to a frenetic rate of release, or even World of Warcraftone of the most popular MMOs of all timeand other big historical licenses like Diablo or (to some extent given recent events about him) Overwatch.
The addition of such a considerable catalog to Microsoft’s stables would thus represent a phenomenal strike force for the Xbox brand, whether it is a question of making them exclusives on the Xbox One and Series X|S consoles, or simply to make them available as soon as they are released on the Game Pass.
Finally, let’s not forget that the gigantic publisher also has a certain King in its pocket, to whom we owe very popular mobile games like candy Crush. Buying out this huge conglomerate would therefore be tantamount to killing two birds with one stone, with a portfolio of very high-caliber “classic” games, but also to claim a large part of the very juicy cake that the mobile game market represents. (especially in Asia).
… tempered by several limitations
But that was Microsoft’s initial ambition. Other industry players and state entities have come to the same conclusions and have done everything in their power to calm the ardor of the American giant.
As said before, the US FTC, the European Commission and the UK CMA have, after careful investigation, blocked the takeover one after another since it was announced in January last year. Microsoft therefore had to fight tooth and nail on several fronts in order to allay the fears of each competition authority. Agreements with the other two industry giants, Nintendo and PlayStation, had to be made, particularly for the distribution of call of duty on these platforms.
It has more or less succeeded in doing so, receiving the endorsement of the European Commission and other similar entities in Asia and other countries. The operation proved to be more delicate with the American FTC, which had to go through a trial from which Microsoft emerged as the winner.
There still remains the British CMA, the last irreducible entity to resist. This invokes as a reason for blocking a situation of virtual monopoly on the cloud gaming market in the United Kingdom. To change her mind, Microsoft had to make deals with GeForce NOW and other cloud gaming players, without success. The last card shot very recently was the outright transfer of cloud gaming rights for Activision Blizzard games to Ubisoft. The British authority has thus agreed to reassess its judgment by next October.
A new video game market landscape
We should therefore know in the coming months if this affair, which is approaching two years of suspense and twists and turns, will finally come to an end. We bet that such a concession on the part of Microsoft for the benefit of Ubisoft should soften the CMA, and thus result in a victory for the American giant. Certainly a hard fight and full of sacrifices, but a victory nonetheless.
If this is the case, the video game landscape will undoubtedly be irreparably changed. More than ever, the trend is for studios to come together under a single banner. There are still very few powerful publishers and studios that are not under the umbrella of a larger organization, as you can see from the table below.
The acquisition of Activision Blizzard King by Microsoft could also allow Xbox to gain a place on the sacrosanct podium, whereas it currently occupies, from a turnover point of view on the game market. video, the third place, after Sony and Nintendo.
The future will tell us if, despite many concessions, this takeover of 69 billion dollars will bear fruit. The other question one might ask is, which big publisher or studio will be next on the shopping list of the biggest fish in the industry? By buying behemoths like Bethesda and Activision Blizzard King, Microsoft has certainly marked a new trend in the video game landscape… for better or for worse?
A chance for Activision Blizzard King to restore its image?
Since, in the context of this decryption, we are in anticipation, it is good form to reverse the prism of analysis and see how this takeover could benefit Activision Blizzard in the more or less long term. At first glance, the direction of the editor will undergo a notable change, because the (infamous) Bobby Kotick will have to leave the function (not without a nice golden parachute, unfortunately).
He will be replaced in his role by Phil Spencer, the boss of Xbox, who enjoys a sympathy capital clearly superior to Bobby Kotick. Despite decisions that are not always relevant, the man has in any case managed to straighten the Xbox ship thanks to his vision, in particular carried by the Game Pass and, to a certain extent, by putting players in the forefront.
Under his tutelage, Activision Blizzard King could therefore take the opportunity to clear his honor and get out of the abyss in which the publisher has sunk for years. Its reputation is indeed at its lowest because of decisions that are so to speak insulting to its community for the benefit of shareholders and investors, or because of sordid cases of moral and sexual harassment, and other appalling pans internally.
In any case, that’s all we wish for this historic studio, which for years made many players dream, including us, before the dream turned into a nightmare, especially since the arrival of Bobby Kotick in power.
18