Microsoft Corp. has announced its intention to buy Activision Blizzard for $68.7 billion. The acquisition dramatically affects the gaming and esports industries.
The purchase is expected to be finalized in 2023. As soon as the transaction goes through, Microsoft will become the third-largest video game company by revenue, behind Sony and Tencent.
Activision Blizzard has been under public scrutiny lately. Still, this powerhouse developed and published a ton of games that captivate millions of users worldwide. Call of Duty: WarZone, Overwatch, Call of Duty Mobile, StarCraft, StarCraft 2, Warcraft 3, and Hearthstone will enrich Microsoft Gaming.
Giving free rein to thought, we see this acquisition as one that can boost esports. Activision Blizzard has many games that perfectly suit the esports scene. At the same time, Microsoft owns its esports first-person shooter Halo Infinite. But first things first. Let’s look back at Activision’s history and find out how the company came to the point of being acquired.
In a nutshell: the history of Activision
Activision is one of the first third-party video game developers, having been around since 1979. Growing, the company teamed up with Vivendi Games and created Activision Blizzard. Blizzard Entertainment was already known for its epic games such as Warcraft and StarCraft. Together with Activision, by the end of 2010, the company became the world’s largest publisher of computer games.
In recent years, Activision Blizzard has been caught up in various scandals. Perhaps the Microsoft deal is the solution that will help it find the way out.
Microsoft will open up a new era in gaming
“Obviously, Microsoft realizes that Activision Blizzard holds one of the largest shares of the gaming market. So, the company will make an absolutely profitable investment. New games capture more and more people, making gaming more than just a promising sphere,” thinks in-house broadcast talent Oleksii “yXo” Maletskyi.
This acquisition can be called a vertical merger. Activision Blizzard and Microsoft are not competitors but two companies providing services in the same industry. Thus, Microsoft can strengthen its current position and expand its influence throughout the gaming world. Once the deal goes through, Microsoft will own over 30 game development studios overall. Many esports fans are holding their fingers crossed waiting for the next steps from the future gaming industry big-wheel.
“Microsoft’s development as an esports company depends on the overall strategy. It has the potential to become a serious competitor in the esports market, but what about its intentions? Many Activision Blizzard games are popular primarily as games, not as esports disciplines. Call of Duty could replace CS:GO in the U.S., but the game shows good results outside esports. Microsoft can support multiple esports disciplines such as Call of Duty, Hearthstone and Overwatch,” says Stepan Shulga, head of esports at Parimatch Tech.
“Typically, such huge deals have a limited impact on the companies’ internal politics. For example, Tencent owns Riot Games, but Riot Games chooses what products they want to build and how they market them. At large, Microsoft can adopt this tradition and keep managing the company without any changes. Even within Activision Blizzard, different esports disciplines vary by type of business model. If Microsoft decides to get into the company’s internal policies, it might not happen earlier than in five years,” shares his opinion Eugene Luchianenco, head of esports at WePlay Esports.
What does the acquisition mean for esports?
“Microsoft may develop new games as esports disciplines. Such a decision requires an appropriate approach: building studios, arranging broadcasts, and establishing relations with the community. Microsoft can follow in the footsteps of Riot Games, so to speak, which promotes its games precisely as esports disciplines. Of course, do not expect changes immediately. Moreover, the pandemic era makes it difficult to implement just any plan,” says Stepan Shulga.
While Microsoft is already into esports, its scene is, frankly speaking, rather small and is a long way from substantial prize pools. Absorbing new tournament operator Major League Gaming is likely to benefit many of Microsoft’s esports endeavors. However, Microsoft has a lot of its own games, so it’s hard to imagine that the corporation will begin to invest in new games at full blast.
“Activision Blizzard has a lot of games that could become famous esports disciplines. However, Microsoft is also working towards their multiplayer competitive games to make them suitable for esports. For example, the recently released Age of Empires 4 has lured away many professional players of StarCraft 2 and Warcraft 3. There’s a good chance that there will be serious competition over where Microsoft should invest its money,” says Eugene Luchianenco.
Many fans are worried about what will happen to the StarCraft 2 and Warcraft 3 disciplines. It is a shame to watch the historical disciplines with which esports began start fading away.
“Two years ago, Blizzard transferred StarCraft 2 as esports discipline to ESL and covered only the prize pools. The same thing happened with Warсraft 3. Will this situation improve? It’s hard to imagine. Microsoft will most likely support these games, but I cannot say for sure that the company will make efforts to change this business model,” adds Eugene Luchianenco.
The good news for gamers is that Activision Blizzard games won’t become exclusive to Xbox. Microsoft has no plans to take the rights to games away from Sony, which means that gamers will still be playing Call of Duty on the PlayStation console.
“Of course, all Activision and Blizzard games will be listed in the Microsoft Game Pass store. However, Microsoft is not limited to its store. The mobile game market and the PlayStation Store will go on distributing games. In any case, part of the games will become exclusive to Game Pass, but definitely not all of them,” summarizes Eugene Luchianenco.
By the way, Sony is not sitting on its hands. The company has already announced that it is buying Bungie, the developer of Halo and Destiny video games, for $3.6 billion. It’s not yet clear how this corporate race will end, but many original games should be coming soon.
“Once, Activision and Blizzard also merged. Now Microsoft is absorbing them. Such purchases will keep surprising the market. In the end, we will have nothing but juggernauts in the gaming industry,” adds Oleksii “yXo” Maletskyi.
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