Jan 18 (Reuters) – Microsoft Corp (MSFT.O) is buying “Call of Duty” maker Activision Blizzard (ATVI.O) for $68.7 billion is the biggest gaming industry deal in history as global technology giants stake their claims to a virtual future.
This deal comes after months of harassment claims against Activision Blizzard. Last July, the California Department of Fair Employment and Housing (DFEH) sued Activision Blizzard for promoting a culture of “constant sexual harassment.”
Reports also state that nearly 40 Activision Blizzard employees have “exited” the company since last July. This kept Activision in a bad spotlight. It makes sense why they would agree to Microsoft’s deal. It gives them a way out and to change for the better.
Microsoft now expects the Activision Blizzard deal “to close in fiscal year 2023.” This means we might not see this deal approved for up to 18 months.
The deal is valued at $68.7 billion, way more in excess of the LinkedIn deal which was about $26 billion. This deal pushes Microsoft into the gaming world. It also allows Microsoft to claim the title of “third-largest gaming company by revenue, behind Tencent and Sony” once the deal gets locked.
“We’re investing deeply in world-class content, community and the cloud to usher in a new era of gaming that puts players and creators first and makes gaming safe, inclusive and accessible to all,” says Microsoft CEO Satya Nadella.
Microsoft plans to add most of the Activision and Blizzard games to the Xbox games pass once the deal closes. With such an acquisition, Microsoft now has access to franchises like Warcraft, Diablo, Overwatch, Call of Duty and Candy Crush. The Xbox games pass currently has 25 million subscribers. This will only keep increasing as Microsoft continues to acquire more studios.
“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,” says Microsoft’s CEO of gaming Phil Spencer.
“As a company, Microsoft is committed to our journey for inclusion in every aspect of gaming, among both employees and players,” says Spencer. “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 hold all teams, and all leaders, to this commitment. We’re looking forward to extending our culture of proactive inclusion to the great teams across Activision Blizzard.”
Microsoft’s huge deal with Activision Blizzard comes about a year after they acquired Bethesda for $7.5 billion. This bolstered their Xbox game studios to a max of 23 which was a huge boost for the Games Pass.