Microsoft is proposing to acquire Activision Blizzard for $68.7 billion, its biggest ever buyout and the largest acquisition in gaming history by a wide margin. The sale, should it go through, would “no doubt” have a material effect on Sony’s position in the video game market, according to one analyst.
Piers Harding-Rolls of Ampere Analysis said in a blog post, “There is no doubt that this deal weakens [Sony’s] position in the market.”
Even if Microsoft continues to release Activision Blizzard games on PlayStation, their inclusion on Game Pass will “undermine Sony’s third-party business,” the analyst said.
“Sony has benefitted from the ability to negotiate timed exclusive content for Call of Duty but this is now under threat,” Harding-Rolls said of Sony’s longstanding deal with Activision to release Call of Duty content first on PlayStation.
There has already been an impact on Sony’s business, it seems. The company’s share price slid dramatically following the news about Microsoft and Activision Blizzard, wiping out $20 billion in Sony’s value in the biggest drop since 2008.
Microsoft’s buyout of Activision Blizzard could have other ripple effects as well, Harding-Rolls said. Third-party games that don’t launch on Game Pass “may suffer as the breadth and appeal of content in Game Pass expands,” he said.
Harding-Rolls went on to say that Microsoft would have a “formidable production engine” with the acquisition of Activision Blizzard and its numerous studios. Microsoft’s proposed buyout might trigger another gigantic deal from another big company to keep pace, Harding-Rolls said.
“This deal, its scale and wider industry ramifications, means that the chances of another large acquisition have risen to an extent. Other publishers and competitors will be busy evaluating what this means for their strategies,” he explained.
Also in the post, Harding-Rolls said the proposed buyout of Activision Blizzard gives Microsoft the opportunity to scale its mobile game business in a big way by taking ownership of the Candy Crush and Call of Duty Mobile franchises, among others.
Check out Harding-Rolls’ full blog post to learn more. For more, check out GameSpot’s recent opinion piece, “Bobby Kotick’s Payout Is A Small Price For The Good That Could Come From Microsoft’s Acquisition.”
Source: Gamespot
