Microsoft plans to buy the powerhouse but troubled video game company Activision Blizzard for nearly $70 billion, its biggest deal ever and one that places a major bet that people will be spending more and more time in the digital world. The blockbuster acquisition, announced on Tuesday, would catapult the company into a leading spot in the $175 billion gaming industry.
Games on virtually every kind of device, from bulky consoles to smartphones, have gained even greater popularity during the pandemic. Technology companies are swarming around the industry, looking for a bigger share of attention and money from the world’s three billion gamers.
In an industry driven by big franchises, Activision makes some of the most popular titles, including Call of Duty and Candy Crush. Yet the company has been roiled in recent months by an employee revolt over accusations of sexual harassment and discrimination.
Microsoft framed the deal as strengthening the company’s hand in the so-called metaverse, the nascent world of virtual and augmented reality. The metaverse has attracted huge amounts of investment and talent, though so far is more of a buzzword than a thriving business. Facebook renamed its parent company to Meta late last year to underscore its commitment.
But the focus on the futuristic metaverse belies the significance of the deal in the present: The acquisition helps Microsoft gain on its rival Sony in the long-running battle for gamers’ attentions and wallets by offering top titles. It also helps the software giant stay ahead of powerful newer competitors in gaming, like Amazon and Google.