Microsoft kicked off 2022 with news that it would be officially acquiring video game holding company Activision Blizzard through a $68.7 billion all-cash deal. Bobby Kotick has been the CEO of the company since 1991.
However, all signs seem to point to Microsoft Gaming CEO Phil Spencer assuming the role once the deal is finalized, which is expected to happen by June 2023. After all, he did tell employees in an email that “once the acquisition is completed, the Activision Blizzard business will report to me.”
If that’s the case, there doesn’t seem to be any bad blood between the CEOs. “I am certain that our incredible talent and extraordinary games combined with our shared commitment to the very best workplace will enable us to grow,” says Bobby Kotick. And he’s proud of what the entire Activision team has accomplished. “We have transformed games into social experiences and enabled players to find purpose and meaning through the most engaging form of entertainment — our games. By doing so, we have created and entertained communities of hundreds of millions of players.”
Activision Blizzard CEO Bobby Kotick’s Big Payday
Even if he’s walking away, Kotick stands to make millions off the Microsoft deal. According to reports, he’ll leave with at least $390 million. The vast majority of that payday will come from the 3.95 million shares of Activision Bobby Kotick owns.
When the transaction is finalized, Microsoft will become the third-largest gaming company by revenue in the world, just behind Tencent and Sony. It will acquire Activision and King Studio’s iconic franchises, including Call of Duty, Candy Crush, World of Warcraft, Diablo, and Overwatch. Microsoft will also obtain Major League Gaming’s global esports activities.
“Coming together, we can accelerate our mission to extend the joy and community of gaming to everyone,” says Spencer. “We have the capability and opportunity to build simply the best, most engaging, most fun entertainment ecosystem anywhere.”
This Activision Blizzard deal is the third time Microsoft has ventured deeper into gaming in the past few years. Microsoft bought Minecraft maker Mojang for $2.5 billion in 2014. And in 2021, it completed a $7.5 billion acquisition of game maker Bethesda.
Why the Metaverse Matters
If you aren’t aware, the metaverse is an advancing form of video gaming, communication, and media that’s the talk of the tech industry. It got a big boost in October 2021, when Facebook changed its name to Meta. And over the next few years, the metaverse is anticipated to manifest itself primarily through virtual reality, which is an alternative digital world that can be used for a vast array of personal and entertainment reasons.
According to Bobby Kotick, the deal with Microsoft is necessary to help ensure Activision Blizzard will be a crucial player in the impending rise of the metaverse. “In that race for the metaverse, it started to become apparent that there were a variety of resources and talent that we needed … we realized now is the perfect time for a combination,” he says.
The metaverse is already utilized in Fortnite, which debuted The March Through Time presented by Time Studios, offering players the opportunity to step back in history and learn more about Dr. Martin Luther King Jr. and the Civil Rights Movement. “These activities progress players through the experience and bring to life important themes of Dr. King’s speech: We move forward when we work together,” explains a statement from Epic Games.
According to Satya Nadella, chairman and CEO of Microsoft: “Gaming is the most dynamic and exciting category in entertainment across all platforms today and will play a key role in the development of metaverse platforms. We are investing deeply in world-class content, community, and the cloud to usher in a new era of gaming that puts players and creators first and makes gaming safe, inclusive, and accessible to all.”