Business Technology

Microsoft’s $60bn Activision Deal Clears $20bn from Sony’s Valuation in a Day


Microsoft yesterday dropped a bombshell that rocked both the gaming and general tech industries. The company revealed it would spend a massive $68.7 billion in all cash to purchase Activision Blizzard. This means Microsoft will control one of the world’s biggest game developers. While shockwaves are being felt through the gaming realm, Sony is feeling the biggest fallout.

Specifically, Microsoft’s announcement wiped $20 billion from the company’s market value. On the Tokyo stock market, Sony’s share price fell up to 13% during trading hours, while in the US the stock slipped 7% at the close of trading last night.

One of the questions surrounding Microsoft’s deal is whether it will make Activision Blizzard’s games Xbox exclusives. We are talking some of the biggest franchises in gaming, such as Warcraft, Diablo, and of course, Call of Duty.

While it is unlikely Microsoft will aim for direct exclusivity, there are some details that are concerning for Sony. For example, customers will likely still be able to buy and play Call or Duty on PlayStation. However, Microsoft will be able to offer the franchise exclusively on its Game Pass platform.

Contrasting Fortunes

I am convinced this is one area of the Microsoft/Activision deal that regulators will pay close attention to. With Microsoft already owning ZeniMax Media (Bethesda) following a $7.5 billion deal, there could be concerns of the company monopolizing the triple A game market. Or, at least attempting to.

It will be interesting to see what Microsoft does with all the major properties it now has. After losing the last generation of consoles in terms of sales, it seems the company has decided to simply throw money at the situation in an effort to beat Sony… it seems to be working.

Market strategist Amir Anvarzadeh noted to investors “Sony will have a monumental challenge on its hand to stand its own in this war of attrition. With Call of Duty now most likely to be added exclusively to the Game Pass roster, the headwinds for Sony are only going to get tougher.”

Although the analyst admits the gaming industry tends to overreact and this is likely the case in this instance.

While Sony’s shares tumble, Activision Blizzard’s rose 25%. Microsoft’s interest has provided a much-needed jolt to a company that has faced controversies around workplace harassment over the last year.

Tip of the day: Windows Power Throttling can net up to 11% more battery savings per charge with little negative impact. In some scenarios you might consider turning Power Throttling off for single apps that you want run with maximum performance. Our tutorial shows you various methods to manage Power Throttling.

Source Winbuzzer

Juliana Luwoye

The author Juliana Luwoye

Leave a Response