How Microsoft And Sony Could Change The $200 Billion Video Game Industry

Big moves are happening in the video game industry. Microsoft, the tech giant behind the Xbox console, announced plans in early 2022 to buy Activision Blizzard, the force behind "Call of Duty" and "World of Warcraft," among other major titles.

This $68.7 billion all-cash acquisition is expected to close in 2023. If approved by regulators and shareholders, it will be the largest tech deal in history.

"There's been a consolidation wave going on in the game space for the last several years," said Eric Handler, managing director and senior research analyst at MKM Partners. "You've had a lot of private equity money flow into the industry. It's highly fragmented. It's just natural to see consolidation. Microsoft being a trillion-dollar company, obviously, they can do bigger deals."

Shortly after the Microsoft-Activision purchase, Sony announced plans to buy Bungie in a deal valued at $3.6 billion. Bungie is currently the developer of the Destiny series, a multiplayer online game that incorporates first-person shooter and role-playing mechanics. Bungie remains best known for creating the original Halo, a first-person shooter that launched with the first Xbox console in 2001.

About CNBC: From 'Wall Street' to 'Main Street' to award winning original documentaries and Reality TV series, CNBC has you covered. Experience special sneak peeks of your favorite shows, exclusive video and more.

Connect with CNBC News Online

#CNBC

How Microsoft And Sony Could Change The $200 Billion Video Game Industry

[SK-uufg]

After hearing things like this, I keep being more and more impressed that Nintendo still exists independently, let alone holding its own against these 2 giants.

[christ]

Completely misses the point of MS spending that much for Activision: Cloud, cloud, cloud

[zodiacfml]

I think there are a thousand of reasons and one of the biggest is MS having a lot of cash right now. Second biggest is the datacenter or the cloud, lots of money will be saved if game servers are within MS datacenters. Third is potentially a Microsoft universe where people almost don't leave the platform like work, education, entertainment.

[Schlierfy]

Don't forget about us PC gamers. Blizzard alone has diablo1/2, starcraft1/2, warcraft series all pc exclusive. If you're gaming on a PC you're using, most likely, windows. Microsoft is making out bigger simply b/c they have PC and Xbox to leverage.

[rkgsd]

Fun fact: Activision was formed by former Atari game programmers with the goal of making higher quality games than what Atari was making for its own console.

[nygeek]

That wasn’t Sony’s response, Sony had taken months to work out those details and the two announcements were within days of each other. Do better research next time,

[IpSyCo]

I support this deal 100%. ActivisionBlizzard is a sh*t show right now. The cultural changes Microsoft can bring will be better for the workers and hopefully better for the consumers.

[jpbredenkamp]

These people actually have no idea that they’re talking about lol. Microsoft is assumed to be selling their consoles at a loss, especially the series S, so referring to them as “pricey” and a laptop being a cheaper alternative in the future is hilarious. The series S is like $300, and you would need an equivalent 600-800 PC to have comparable specs for a game.

[rem]

Sony buying Bungie was being worked on back in summer 2021 before Microsoft bought Zenimax or Activision Blizzard

[luxushauseragency]

Games are more interesting and exciting to play than watching movies or television.

[jorgeavelar]

Microsoft isnt even competing against Sony anymore. They have their eye set on other soon-to-be players such as Google or Amazon who have the resources and money to get into gaming, especially with the advent of cloud gaming. Sony unfortunately is behind the curve on that and is not on the same level

[brookeblake]

Video games are entertainment tools and computer software programs, representing advances in technology and productivity. For tech companies such as Tencent, SONY and Microsoft, the integration of the game industry is also an increase in technological prowess.

[nygeek]

Microsoft will bring Starcraft 2 the love it deserves.

[beebimbop]

Hope this could help Blizzard revive their legacy games

[thepeff]

As someone who hates seeing MS buy up all his favorite properties I have to admit that MS probably just saved Activision/Blizzard from itself

[hmp]

We need a whole new separate console from these. One where true ownership is involved. Little do people know is you can buy and purchase all you want but you don't truly own any of it.

[Ohiostategenerationx]

It's called common sense. They did it to make even more money. It will have way more people buying the Xbox live memberships meaning a lot more money being made in the long run.

[kjrchannel]

My issue with Micromanagementsoft is they could very well restrict Operating Systems and Hardware that could interact with Blizzard games. I would rather see them go bankrupt, or be completely open source .

[kbnice]

Now may be a good time for a bunch of developers to come together and create a 3 new console or platform that would be more affordable with great games kind of like what sony did when we only had sega and nentendo.

[marcusray]

Sony buying Bungie wasn't poking Microsoft. They used to own them anyway and let them go. In other words, Microsoft doesn't give a damn about Bungie anymore. 🤷‍♂️