Microsoft shocked everyone in the gaming community when they announced that they have entered into an agreement to acquire Activision-Blizzard, best known for their Call of Duty franchise, for a whopping sum of $68.7 billion, in an all-cash deal. The size of this deal overshadowed any acquisition Microsoft has ever made and surpasses the $7.5 billion deal to acquire ZeniMax Media, parent company of Bethesda and other notable studios in March 2021. The current deal, if it goes through, will make Microsoft the third largest gaming company in the world after Sony and Tencent.
Studios and their IPs
Including the most recent deal, which is set to conclude in 2023, Microsoft has developed a strong line-up of world class studios and the games on offer. Let’s take a look at some of the notable in house studios as well as acquisitions and see some of their iconic games along with other games in development.
Starting off with 343 Industries, the developers of the Halo series after Bungie departed from Microsoft, they recently released the newest entry into the Halo franchise, Halo Infinite, to generally positive reviews after a tumultuous development cycle. Halo infinite also features a free to play multiplayer with the single-player campaign releasing as a separate portion, enabling players to experience the fabulous multiplayer experience that Halo has been known for, free of charge. Moving to Turn 10 Studios and Playground Games, the developers of popular racing series Forza Motorsports and Forza Horizon, respectively, recently released Forza Horizon 5 to a host of positive reviews and is a critical success. The Coalition which took over the development of Gears series after Microsoft purchased the rights from Epic Games, released Gears 5 and provided assistance in the development of Gears Tactics, both of which were well acclaimed and loved by fans.
Focusing on the acquired studios, we have Mojang, the studio responsible for the best selling game of all time, Minecraft, which till this day is doing excellent with a steadily growing community and a strong support from the developers. Ninja Theory, the ones responsible for the incredible cinematic experience Hellblade: Senua’s Sacrifice, are working on the eagerly awaited sequel to Hellblade, titled Senua’s Saga: Hellblade 2 and a release date announcement could be possible soon. Obsidian Entertainment, with their Pillars of Eternity series and The Outer Wilds, are in the process of developing a sequel for The Outer Wilds. We also have Undead labs which are behind the State of Decay series and Complusion Games who are the developers of We Happy Few along Rare, the devs of some of the most beloved games like Banjo-Kazooie, which hasn’t released anything memorable after Microsoft bought them in 2002.
Moving on to the big acquisitions like ZeniMax Media and it’s subsidiaries, we have 6-7 development studios as a part of it. There is Alpha dog games, who are mobile game developers then Arkane Studios, the developers of critically acclaimed Dishonored series as well as Prey 2017 and more recently, Redfall which is set to release in 2022. Bethesda Game Studios, the most notable of the bunch, is the developer of Fallout series, Elder Scroll series and are in the process of developing their latest project Starfield set to release in 2022 as well as Elder Scrolls 6 which has no ETA as of now. Not to forget id Software, developers of Doom, Quake, older Wolfenstein games and Rage, all of which are superb genre defining titles. The line-up also includes MachineGames and Tango Gameworks, the developers of current Wolfenstein games and Evil Within series respectively along with ZeniMax Online Studios who developed Elder Scrolls Online.
Finally, let’s take a look at what Microsoft is getting for almost $69 billion it is spending on Activision-Blizzard. We have the 4 horsemen of the legendary Call of Duty series’ developers, Infinity Ward, Treyarch, Sledgehammer Games and Raven Software. Call of Duty games have been topping yearly sales charts for almost a decade and this trend seems likely to continue for the foreseeable future. Toys for Bob with their famous Skylanders series as well as their work on Spyro Reignited Trilogy and Crash Bandicoot 4 along with support on Crash Bandicoot N. Sane Trilogy, have made them a valuable asset with a proven track record. Lastly, we have Beenox who have also worked on SKylanders series as well as lending help with Tony Hawk’s Pro Skater 1 & 2 and several Call of Duty games along with Highmoon Studios who also have a diverse portfolio. Blizzard Entertainment brings with it their cult classics, Diablo, Warcraft and Overwatch, all of them giants in their own right. Microsoft will also get King, the developer of mobile game Candy Crush, which is a household name at this point of time.
It is amply clear that Microsoft has never been in a better place since the 360 days at this point of time, with a strong and an ironclad lineup of studios and iconic games, they are ready to fight it to the top. With Microsoft betting big on its Gamepass subscription service and promising to release all its first party games day 1 on Gamepass, the value of the service will shoot up significantly when you factor in games like Starfield, Elder Scrolls 6, new Call of Duty, Overwatch 2 and many more titles being available to play via Gamepass. They will also get a big presence in the mobile gaming sphere with King’s Candy Crush as well the mobile version of Call of Duty and Phil Spencer has stated that mobile gaming is the biggest market currently, although it remains to be seen how Microsoft will expand further into the mobile gaming market.
Ramifications and Competitors
While, the Activision-Blizzard deal will conclude in 2023, it has already sent ripples across the industry and the gaming community who are speculating as to what will be the response of Sony as they have had a close partnership with Activision for Call of Duty franchise, Crash Bandicoot and Spyro, the latter two being Playstation icons. Some are speculating that Sony will also make an acquisition of its own to bolster its own portfolio to counter Microsoft’s new deal and some people have shared the valuations of some notable gaming companies like Sega, Konami, Square Enix etc as potential companies to be acquired.
This track of thinking seems kind of alarmist and feels hollow as they fail to factor in the brilliance of Sony’s first party studios and the games made by them. Also, Sony hasn’t been sitting idle as they have made acquisitions as well like Housemarque, developers of Returnal, Bluepoint Games who made the Demon Souls Remake and a few more. They have an incredible summer line-up with Horizon Forbidden West, Gran Turismo 7, Forspoken, Sifu and several more interesting titles. Phil Spencer went on record saying, just like during the ZeniMax Media acquisition, that any deals made between Activision-Blizzard and Sony will be honoured as well as keeping Call of Duty series on Playstation.
There is also the fear of consolidation in the gaming industry leading to fewer options for independent game developers looking for publishers for their games and as a result ending up with a lower bargaining power, but it is all speculation at this point and it remains to be seen as to what the actual scenario will be in the future. However, this much is certain that Microsoft will take any steps to ensure that they have a major presence in all spheres of gaming, whether it be mobile, console, pc or even the ‘metaverse’ (Satya Nadella is betting big on this) and they certainly have the resources to make it happen.