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Impact of Microsoft-Activision Merger on the Gaming Industry

Lanon Wee

Microsoft has completed its acquisition of Activision Blizzard, with a transaction amount of $69bn (£56bn). That's a hefty sum, but what implications could this deal possibly have for when a person purchases a video game? Fans are continually inquiring about this. The Call of Duty series of video games is amongst the most successful of all time, below only Mario, Tetris and Pokemon in terms of total sales. Good news for Sony fans: it will be at least 2038 before the game could possibly be available as an Xbox exclusive. Under the terms of the agreement, Ubisoft has secured "cloud gaming" privileges for every Activision Blizzard title, both existing and upcoming, over the course of the next 15 years. In order for the agreement to be accepted by UK regulators, who were concerned about Microsoft becoming too powerful in the cloud industry, it was necessary for the company to agree to certain conditions. If you aren't familiar, cloud gaming is where people stream video games across the web - the much-talked-about "Netflix for games". At this time, two of the major players in gaming subscription services are Ubisoft+ and Sony's PlayStation Plus, in addition to Xbox Game Pass. On Monday, in a post on X, Activision Blizzard announced they anticipate beginning to include its titles in Game Pass in 2021 - this means it's possible the upcoming Call of Duty, and other games, could be available for Xbox users on their launch day. Before this deal, Sony had the upper hand when it came to Call of Duty, with their special privileges such as early access, testing, and bonus content. However, that might not be the case anymore. Furthermore, Microsoft has a tendency to make its most significant titles playable on Game Pass on the day of their launch, for a subscription fee every month. It's ultimately left to the gamers to determine if it's a better option to purchase the game or to pay for access to it. It is noteworthy that the UK regulator was so uneasy about it that it ensured Activision Blizzard games could not be streamed only on Xbox over a period of 15 years. Microsoft has some history in this area - when Starfield, highly anticipated, released in September 2023 and won praise, it was available solely on PC and Xbox and could be played from the beginning via Game Pass. Despite the fact that video games can still be played on the PlayStation console, Microsoft will be the ultimate victor. Ubisoft may have held on to the streaming rights to Activision Blizzard games for a long duration of 15 years, however, in recent times, game companies have been making far greater profits through in-game purchases, otherwise referred to as microtransactions. Statista reported that in 2022, the business profited from microtransactions, digital downloads, and royalties to the total amount of $5.89bn, which was more than triple the $1.6bn made from direct game sales. Sony's share of the revenue from in-game purchases can vary from game to game, though it is typically around 30%. This means that for games such as Call of Duty, buying in-game items will ultimately be funding the competition. At EGX this week, BBC Newsbeat interviewed fans to hear their thoughts on the deal, with sixteen-year-old Oliver expressing that it could be beneficial for Call of Duty. He contended that the additional resources this company has would broaden the gaming market. In the meantime, Sophie, who was declared Ubisoft's Content Creator of the Year, indicated to the BBC that her sole aim is for the games to be successful. She expressed that the aim is to ensure everyone has access to the video games they desire. It's clear that we each have our own ideas, but at the end of the day, as long as we're producing good games, we're happy with that. Prior to loading any of the content provided by Instagram, we require your approval. They might be using cookies and other technologies, so it may be worthwhile to read Meta’s Instagram cookie policy and privacy policy before agreeing. If you wish to view this content, please select 'accept and continue'. Not all people have a positive outlook. Once upon a time, the Activision titles Crash Bandicoot and Spyro the Dragon were exclusive to PlayStation; for this reason, certain fans are anxious about the potential for a permanent transfer to Xbox in the future. Some fans have gone as far as to make petitions urging Microsoft to ensure that all games remain playable on all consoles indefinitely. Activision Blizzard has its own studios located in London, Guildford, and Warrington. Additionally, they own King, a company based in both Stockholm and London that created the popular Candy Crush Saga. In total, this agreement will see an increase in the number of UK studios which Microsoft holds sway over. Ukie - the body which stands for video game businesses - informed the BBC that this kind of overseas investment was "highly important" to the British market. A spokesperson stated that between January 2017 and June 2022, 89% of the entire investment in the UK games industry was from non-UK entities. In terms of financing games, this kind of money makes a huge impact. It increases the size of the immense gaming domain controlled by the US company. Gamers who had the N64 during their childhood may remember Microsoft's $375m acquisition of Rare in 2002. Before that, Rare had been focusing specifically on Nintendo titles. Contemporary gamers may be more aware of Microsoft's acquisition of Mojang, the developer of Minecraft, in 2014, for a staggering $2.5 billion - making the company the proprietor of the top-selling video game of all time. The company has endeavored to achieve the same level of influence it had in computing in gaming through a multitude of shrewd acquisitions, such as the one mentioned above. It has acquired over 20 gaming studios in total. We've already mentioned some major titles, but Microsoft is about to gain control of even more. There are many noteworthy names, including: There are a large number of highly successful titles set to become part of Microsoft's portfolio.

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