News broke this morning that Microsoft is set to acquire gaming juggernaut, Activision Blizzard, for a reported $68.7 billion. Assuming the deal goes through, which will very likely get some heavy scrutiny from the revised FTC, it will no doubt change the landscape of gaming and emerging technology like the metaverse.
But how does that purchase stack up against others from Microsoft? As it turns out, it's the most expensive for the company, by a lot.
Here are the top ten acquisitions, by value, for Microsoft:
| Rank | Date | Company | Genre | Value (USD) |
|---|---|---|---|---|
| 1 | Jan 18, 2022 | Activision Blizzard | Video Games | $68,700,000,000 |
| 2 | Dec 8, 2016 | Professional social network | $26,200,000,000 | |
| 3 | Apr 12, 2021 | Nuance Communications | Speech synthesis and recog | $19,700,000,000 |
| 4 | May 10, 2011 | Skype Technologies | Telecom | $8,500,000,000 |
| 5 | Sept 21, 2020 | ZeniMax Media | Video games | $8,100,000,000 |
| 6 | Oct 26, 2018 | GitHub | Software dev | $7,500,000,000 |
| 7 | Sept 2, 2013 | Nokia | Smartphones | $7,200,000,000 |
| 8 | Aug 13, 2007 | aQuantive | Digital marketing | 6,333,000,000 |
| 9 | Nove 6, 2014 | Mojang | Video games | $2,500,000,000 |
| 10 | Jan 7, 2000 | Visio Corporation | Wholesale drawing soft | $1,375,000,000 |
If you add up just the acquisitions on that list from the last ten years (squeezing Skype in there from 2011), it adds up to a whopping $147.8 billion. Indeed, all but two of the top ten acquisitions were made after 2011, suggesting that Microsoft is using its increasingly colossal pile of cash instead of sitting on it.
Perhaps more interesting is how of that $144.8 billion spent, Activision Blizzard accounts for a massive 46% of it.
By comparison, Mojang, the team behind Minecraft, was a steal at just $2.5 billion back in 2014. While many questioned the value to Microsoft (and predicted the company would ruin the franchise), it has literally become one of the most successful games of all time. It now boasts 141 million monthly active users (up from 40 million in 2016) with over $350 million in revenue from the storefront.
Of course, not all of Microsoft's acquisitions went quite as smoothly. Nokia's mobile smartphone division was bought, integrated, and then effectively killed off with Windows Phone in 2017. That said, Microsoft still retains some talent from the Finnish company and know-how regarding mobile.
Narrowing the scope of acquisitions under just CEO Satya Nadella's stewardship since 2015, the picture is very positive, as they include:
- Activision Blizzard (pending)
- Nuance (pending)
- ZeniMax Media
- GitHub
While LinkedIn is often the butt of jokes, Microsoft is laughing all the way to the bank. The professional social network now brings in over $10 billion a year in revenue. Considering Microsoft bought it for $26 billion just over five years ago, the division is undoubtedly profitable and continues to grow (revenue was up 21% back in July 2021 year-over-year).
GitHub, which is critical for open-source software development, also added a reported 16 million new users just in 2021 alone, to bring it to a total of 73 million users. Projections are that GitHub will cross 100 million users by 2025.
There's also good news for purchases like ZeniMax, which owns Bethesda Softworks, id Software, Arkane Studios, Machine Games, Tango, and such titles as DOOM, Elder Scrolls, Fallout, and Quake. When combined with Mojang and Activision Blizzard (assuming it goes through), Microsoft is undoubtedly in an excellent position to continue to grow its nascent Xbox Game Pass, as our Senior Editor Jez Corden recently detailed.
Overall, Activision Blizzard is a massive acquisition by Microsoft. Clearly, the company sees gaming as a top priority, even crowning Phil Spencer CEO, Microsoft Gaming.
While Microsoft is blowing through cash at a tremendous rate compared to a decade ago, the company was sitting on $130.615 billion as of September 2021. In other words, while this purchase will cost a lot, the company can easily afford it. Now let's see if the deal gets approved.
