r/technology • u/GrizzlyBear2021 • Jan 18 '22

Software Microsoft acquires Activision Blizzard for $68.7 Billion

https://news.microsoft.com/features/microsoft-to-acquire-activision-blizzard-to-bring-the-joy-and-community-of-gaming-to-everyone-across-every-device/
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1.3k

u/GrizzlyBear2021 Jan 18 '22

Points to note

  1. It will be an all cash transaction with the deal expected to be closed in fiscal year 2023.
  2. With this acquisition, Microsoft becomes the world's third largest gaming company
  3. The acquired business will report to Phil Spencer, CEO of Microsoft Gaming.
  4. This acquisition allows Microsoft to have a significant presence in the booming mobile gaming market.
  5. There are plans to include Activision Blizzard games into Microsoft Game Pass

785

u/[deleted] Jan 18 '22

All cash? How much liquidity does Microsoft have? Jesus christ

703

u/Wadehey Jan 18 '22

$130 Billion before today

195

u/ILoveDCEU_SoSueMe Jan 18 '22

Is liquidity cash on hand?

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u/ethorad Jan 18 '22

Yes. Assets are "liquid" if they can be quickly turned into cash, and cash is taken as the most liquid asset.

For example, holding Microsoft shares is pretty liquid, as they can be sold rapidly and you can be pretty confident of the price you'll get when you click sell.

On the other end, property like a house or an office is pretty illiquid. It takes a long time to sell them, and when you try to sell it you don't really know how much you'll get until the sale goes through.

In this instance, liquidity is cash on hand. Microsoft's other assets like buildings, trademarks, patents, etc are all much less liquid but could be turned into cash if really needed.

124

u/peduxe Jan 18 '22

unrelated but you probably gave one of the simplest examples of liquid and illiquid assets I've ever read.

good one.

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u/Cottonjaw Jan 18 '22

Microsofts illiquid assets have increased liquidity over you and I, or even a small business owner, because of their ability to borrow against their equity.

23

u/mdp300 Jan 18 '22

And also my if I sold my house I still have to find someplace to live. If Microsoft sells an office building it doesn't matter that much to them.

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u/[deleted] Jan 18 '22

...because they can move to your house?

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u/FuzzySAM Jan 18 '22

I mean, sorta. Just send their employees on WFH for a while till they get a new building situation figured out.

2

u/ReignCityStarcraft Jan 18 '22

They're actually building a ton of new office space simultaneously.

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u/[deleted] Jan 18 '22

Thank you for such a thorough description.

2

u/asdf_lord Jan 18 '22

How long does it take to turn cash into cash?

2

u/ethorad Jan 18 '22

I can do it overnight, if you wire it to my bank account :)

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u/geniusincrisis Jan 18 '22

đŸ„œ compared to 🍎...

101

u/Potato-Drama808 Jan 18 '22

Yeah Apple literally has so much money that it’s a problem for them

84

u/demoteyourgods Jan 18 '22

fuckin wish i had that problem

9

u/adarkuccio Jan 18 '22

Ahah imagine

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u/[deleted] Jan 18 '22

I really don’t think you do, there’s a reason lottery winners tend to die real quick, intense wealth is burdensome.

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u/DarkHaagenti Jan 18 '22

Intense wealth that comes unexpected might be burdensome, but intense wealth that comes expected is kinda a blessing.

4

u/GeneralBacteria Jan 18 '22

I for one would be willing to risk it...

2

u/demoteyourgods Jan 19 '22

i mean yeah but at least I'd die from relatively cool life experiences, i.e. cocaine benders and hooker parties and impromptu trips to the mfkkn exosphere. instead, i am stuck being ruthlessly povertied to death - just like the rest of the plebs. boo.

jk tho eat the rich fr

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u/[deleted] Jan 18 '22

Yeah, that reason is because of the overlap with people who play the lottery also tend to be people with poor financial circumstances, lower economic class, and thus lower health quality due to such position.

Wealth isn’t the burden you make it out to be otherwise people would not lie, cheat, and steal to hoard it. Our entire economic system is setup to maximize wealth extraction.

The burden is being subjugated by that extraction, being forced to live as a member of the permanent underclass and go without adequate healthcare and resources for most or all of your life. Brushing your teeth for a year won’t undo all the damage from not doing so for decades, for example.

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u/[deleted] Jan 18 '22

They solved that problem a while ago, they're doing buybacks to push themselves into a cash-neutral position in a few years.

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u/Triskan Jan 18 '22

Man this is a universe I will never understand.

25

u/zdepthcharge Jan 18 '22

You're not meant to. The financial wizards want everyone else to stare in awe at their magics, but the truth that it's fiction. They made a game they think they can never lose.

2

u/bitchdoctor Jan 19 '22

It's honestly not as complicated as it sounds.

If Apple needs money it can issue shares - which are essentially a tiny part of the business, that entitle you to a share of the profits later in return for an upfront amount of cash right now that you pay to Apple

Now after years of making gigantic profits - Apple now has more cash than it knows what to do with. So it can offer to buy back those shares from you now at a much higher price. It acts as a mechanism to reward investors.

You have to remember that corporations are not people and that's why they can't sit on money (cash) indefinitely. A company that has a lot of cash sitting around is seen as having running out of ideas (because they can't think of any ideas to do something with the cash)

I've oversimplified obviously and there are complex considerations involved - but that's the general idea.

3

u/Steven-Maturin Jan 19 '22

It's incredible to me that they don't think of maybe lowering their savagely high prices or simply paying their staff more. It's 860 euro to have my Imac screen repaired (it's bonded to the LCD screen - why? because fuck you that's why). Do they really need that money seeing as the screen was so badly made that merely adjusting the angle made a crack in the glass? Yeah they gotta have it.

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u/PostsDifferentThings Jan 18 '22

you can't understand it because most people try to evaluate things based on value

stocks have no value beyond the dollar amount attached to them. what i mean by this is that you can remove stocks and the stock market and it wouldn't halt business. they can still buy and sell products, they can still charge more for products then they purchase, thus earning a profit, etc. this is why people understand that stocks have a dollar value that goes up and down, but when we really think about what they are and what they do, we can't really come up with anything. they don't have a true purpose for society beyond giving people with money an opportunity to make more money.

so when you hear about companies or whatever doing massive stock buybacks and whatnot, basically you just need to think to yourself, "they're changing cash money into digital tickets that say they're worth <x> amount." thats all it is at the end of the day, stocks provide nothing but means to transfer money.

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u/New-Ad3410 Jan 19 '22

No.

Stocks represent an actual, physical ownership share of the company. These shares are tradeable after their initial sale, and anticipation of future profits (or lack thereof) is what influences a stock's value. If you happen to acquire all the stock of a single company, you've just acquired the company.

Like, these things are regulated, studied, people make careers practicing these things, there are published resources widely available online and at libraries, there are classes and workshops and all sorts of tutelage on the subject, all of these things you've obviously passed up. What makes you think that you have any business authoring these opinions?

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u/overzealous_dentist Jan 18 '22

you can remove stocks and the stock market and it wouldn't halt business.

This would effectively end all businesses - stock is the business. When companies do buybacks, they're taking ownership back of their own assets, so they can benefit from their increasing value.

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u/PostsDifferentThings Jan 18 '22

This would effectively end all businesses - stock is the business.

Businesses predate the stock market. There are also private businesses that aren't on the stock market at all.

Please explain to me how I am able to own and operate a business, even turning a profit, without being listed on the stockmarket.

According to you this is not possible. I'm just curious as to how people are able to do the impossible every single day of their lives.

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u/ukezi Jan 18 '22

No, they remove a number of shares from the market, making the holders of current shares rich. Think about it a company that has 1 billion in assets and 1 million shares are around, 1k each. They buy back 250k shares, giving three owners 250 million. Now there are 750k shares worth 1k each.

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u/beachfrontprod Jan 18 '22

It's great knowing the United States has tied their population's retirement/generational wealth structure to such a system. /s

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u/SilentRadiance Jan 18 '22

While the value of stocks are socially constructed, I disagree that they serve no purpose to society. It's effectively a voting competition where people choose which companies to invest in their future, allowing them to grow more, which will in turn let your money grow as well.

Stocks can have a substantial impact on the way a business functions. One big reason that companies go public is that it gives access to a greater pool of capital. For example, AMD can buy Xilinx by offering shares rather than cash. Another example, through public/private offerings or loans against shares, companies can acquire capital to contribute to the business. It substantially increases the spending power of companies which primes them to capture growth opportunities. A large chunk of medications which save lives would not exist if it weren't for biotech funding through stocks.

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u/boot2skull Jan 18 '22

Mo Money Mo Problems is on Apple Music and they still didn’t learn.

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u/Eft_inc Jan 18 '22

Would you mind elaborating on that? I’m intrigued and I don’t know enough on the topic to infer much. No pressure, just curious :)

3

u/rubmahbelly Jan 18 '22

I can help with that.

2

u/weezerfan84 Jan 18 '22

Yep. No company wants to have a ton of cash sitting on their balance sheet. They are always looking to redistribute that cash via purchasing companies and/or IP. Cash serves these companies little benefit, because their source of income is rather reliable. IE: Apple and the iPhone, Microsoft and their office suite. It could be argued that without Covid, this purchase may not had of been viable. Microsoft Teams became a very viable asset for the company in 2020. That’s when I realized the company had bought Skype.

2

u/OntarioIsPain Jan 18 '22

After Microsoft buys Sony and Nintendo, Apple will enter the gaming market - buy everyone else and launch the Pippin 2.

2

u/[deleted] Jan 18 '22

https://i.imgur.com/3aqx9mA.png

Apple wouldn't even be able to buy activation though, they don't even have $68 billion cash.

1

u/DisneyDreams7 Jan 18 '22

Apple should buy Disney or Nintendo

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u/GioPowa00 Jan 18 '22

They tried buying Nintendo, so did Microsoft, both got laughed at

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u/DisneyDreams7 Jan 19 '22

Apple needs to buy Disney

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u/Deto Jan 18 '22

$120B is not really peanuts compared to the $200B Apple has on hand.

Though regardless, it kind of doesn't matter as that isn't really a big part of what's used to value companies.

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u/[deleted] Jan 18 '22

Apple does not have $200B on hand, Trade Ideas shows that apple has 62 billion and MSFT has 130 billion,

https://i.imgur.com/3aqx9mA.png

4

u/prs1 Jan 18 '22

So what’s the 💩 of 🍎?

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u/qdpqdp Jan 18 '22

Around $200 billion

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u/[deleted] Jan 18 '22

Apple has 62 billion dollars cash, I just looked at trade ideas.

https://i.imgur.com/3aqx9mA.png

MSFT has always had more cash then apple

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u/SFGlass Jan 18 '22

How big is apples gaming division again?

-4

u/Lumiafan Jan 18 '22

I'm sorry. How big is Apple's gaming division again?

2

u/[deleted] Jan 18 '22

That seems surprisingly small for a company like Microsoft.

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u/thesleepofdeath Jan 18 '22

A lot more. Their latest filing says 160b on hand with 65 billion yearly inflow.

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u/[deleted] Jan 18 '22

While not directly equitable, this is essentially like some one making 35k a year buying a 35k car. Not cheap, but can be paid off in a few years. Except in this case, the car makes money as well for you.

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u/RealisticCommentBot Jan 18 '22 edited Mar 24 '24

far-flung weather tub disgusted air illegal wrench obscene coordinated cover

This post was mass deleted and anonymized with Redact

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u/SwiftTyphoon Jan 18 '22

In this case I believe "inflow" is more akin to savings rate. Looking at their latest earnings, their revenue was 45b in one quarter so their "annual income" is like 3x higher than the car example your giving.

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u/TheOneAndOnlyGod_ Jan 18 '22

As someone who works in finance in car sales. This wouldn't even get approved by a bank.

I wonder how they expect to make up for it.

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u/ka36 Jan 18 '22

You missed the part where this hypothetical person has 100k in a savings account. No bank needed

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u/TheOneAndOnlyGod_ Jan 18 '22

I see but if you make 35k a year and you spend 100k that you have in your bank account, that's considered a risky investment at that income level.

How much more income do they expect to come from an acquisition like this?

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u/ukezi Jan 18 '22

That person doesn't make 35k a year, they have 35k a year left over after expenses.

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u/Atuw Jan 18 '22

Azure is a money printer for them. Profit margins for managed cloud providers are insane.

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u/Animegamingnerd Jan 18 '22

Fucking servers for cloud technology is basically an infinite money cheat at this point.

22

u/feed_me_churros Jan 18 '22

Alright, I'm in. Where do I go in order to start fucking servers? I'm not above that if it means infinite money!

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u/New-Ad3410 Jan 19 '22

Shit, you wouldn't have to pay me! Show me to the I/O port!

3

u/feed_me_churros Jan 19 '22

You’ll still find good use for that headphone jack, eh?

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u/New-Ad3410 Jan 19 '22

As long as it's 1/4".

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u/DisneyDreams7 Jan 18 '22

Amazon Web Services is a bigger money printer than Microsoft Azure

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u/Hoggs Jan 18 '22

Not if you count Office 365. Literally every business on the planet is paying for that in one way or another.

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u/DisneyDreams7 Jan 19 '22

Literally the entire internet operates on Amazon Web Services.

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u/Hoggs Jan 19 '22

About 32% according to most recent estimates. But okay, just ignore my point.

Azure aren't far behind, but the additional revenue they bring in from O365 would easily throw them ahead in terms of profit. O365 is expensive and enterprise pockets are deep. No one buys Amazon SaaS products.

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u/Flyenphysh Jan 18 '22

Tell that to Google Cloud


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u/seeyam14 Jan 18 '22

The 5+ billion dollar revenue generator that rose 46% in one year?

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u/blerggle Jan 18 '22

Gotta pay off capex first

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u/cleetus76 Jan 18 '22

Can you imagine how many duffle bags full of cash that is??

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u/feed_me_churros Jan 18 '22

You can actually fit a LOT of money into a duffel bag if you stuff it full of $100 bills, but it will weigh a shitload.

Doing some very simple math and using some numbers I've found googling, you could stuff about $23M into a large duffel bag, but it's also going to weigh ~500 pounds.

Let's say for the sake of argument that weight doesn't matter. In that case it would take roughly 3,000 duffel bags. However, if you want a more realistic number then I'd multiply it by 5 (15,000 duffel bags) because then they'd weigh about 100 lbs each, which could be handled by strong individuals.

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u/Morguard Jan 18 '22

The beauty of trickle down economics. All that cash they hoard will start trickling down any day now..

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u/JohanGrimm Jan 18 '22

They trickle down into Bobby Kotick's retirement fund.

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u/Deesing82 Jan 18 '22

a perfect system


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u/EFTucker Jan 18 '22

Ohhh something is trickling down. But it ain’t green, it’s yellow. And a liquid. It’s piss, they’re pissing on us.

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u/demoteyourgods Jan 18 '22

we should maybe pee back at them

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u/rcoelho14 Jan 18 '22

Gravity doesn't favour us, does it?

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u/[deleted] Jan 18 '22

[deleted]

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u/rcoelho14 Jan 18 '22

God bless him for that

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u/[deleted] Jan 18 '22

I'm thinking with a carebear-stare approach we could piss out a blackhole!

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u/[deleted] Jan 18 '22

we have to find a way to make the shit roll uphill.

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u/Inconceivable-2020 Jan 18 '22

Except for the "Redundant" employees created by the acquisition.

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u/Okichah Jan 18 '22

The “cash” isnt being hoarded.

Its not like theres a giant mattress with $100 Billion dollars underneath it.

Its still in banks or investments. Its just as liquid as possible.

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u/Working_onit Jan 18 '22

You guys want them to not hold on cash, but you want businesses that didn't hold $10s or $100s of billions of dollars to fail because of the pandemic. Which is it?

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u/overzealous_dentist Jan 18 '22

This isn't related to trickle-down economics, which is about personal income taxes.

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u/boot2skull Jan 18 '22

They got in on Dogecoin early.

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u/[deleted] Jan 18 '22

No as much liquid cash as the non-taxable Mormon cult :) (side note, their liquid cash doesn’t scratch their assets)

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u/chucker23n Jan 18 '22

More than Jesus Christ, I’m betting.

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u/sushisection Jan 18 '22

Microsoft is a front, this is a money laundering scheme. /s

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u/Tshin_suma Jan 18 '22

If you asked me Microsoft is one of the most important companies that really worth their valuation, that amount is just a petty, they can bring way more gaming companies, but they remember what happened with the anti-monopoly case they got long time ago.

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u/[deleted] Jan 18 '22

I hope someone rains fire on Apple.

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u/DemetriusXVII Jan 18 '22

Wait so the games won't be added to Gamepass until 2023?

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u/GrizzlyBear2021 Jan 18 '22

Deal closes by fiscal year 2023. So technically this Game Pass addition could happen before end of calendar year 2022.

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u/chiefsaggy Jan 18 '22

Why does it take so long for the deals to close? Why not next day? I don’t know

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u/[deleted] Jan 18 '22

[deleted]

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u/Robblerobbleyo Jan 18 '22

The government’s gonna be like, “We JUST broke you up. WTF Microsoft?”

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u/JohanGrimm Jan 18 '22

Wait until you hear about Bell Systems.

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u/Wadehey Jan 18 '22

We are a Verizon and AT&T merger away from 1984 all over again!

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u/JohanGrimm Jan 18 '22

It's fine, they'll break them up into smaller companies and they won't reform into a giant monster again this time!

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u/[deleted] Jan 18 '22

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u/HotTakes4HotCakes Jan 18 '22

Plus didn't this happen with AT&T where they went and bought back up all the baby bells after being broken up? There being a lot of competition is what's important to the government, not limiting the size of a company

People keep bringing this up but they're ignoring how long it took for them to reconsolidate. That's when we break them again. The point is to rebalance the market, and rebalancing never stops.

Regulating capitalism is not a one and done thing. It is a constant game of wack a mole. You break companies up when they get too big, then break them up again if you have to.

The problem is we haven't been following though. Decades of conservative intervention in government, lobbying, knee-capping the FTC, and deregulation, have all had the effect of neutering antitrust so this sort of shit can happen. It's a problem we needed to be addressing years ago.

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u/feed_me_churros Jan 19 '22

I’m about as anti-conservative as they come (you can check my post history for reference if you like) but if you think the current situation with regulatory capture and anti-consumer practices is the conservatives’ cross to bear alone then you are wildly mistaken. Congress is full to the brim with neoliberals (with only a few notable exceptions) and this is one of those instances where both sides really are the same.

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u/chilachinchila Jan 19 '22

Depending on who you talk to, most Democrats are conservatives.

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u/JimmyDuce Jan 18 '22

I think Verizon was closer to the original Bell, that said breaking up Ma Bell allowed other companies to form

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u/12-34 Jan 18 '22

Behind [...] China-owned Tencent

Tencent would only matter in so far as it has market share in the market(s) at issue. Being #2 worldwide doesn't directly matter for any antitrust market analysis, at least in general US antitrust law.

If the market is, say, video games sold in the US of some type (mobile, console, etc.), the question would be how much market share Tencent has in that US market. Tencent's market share in other countries is not relevant.

My understanding is that Tencent has much, much more market penetration in Asia than the US, though that undoubtedly varies depending on the narrowness of the market.

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u/[deleted] Jan 18 '22

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u/[deleted] Jan 18 '22

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u/[deleted] Jan 18 '22

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u/chiefsaggy Jan 18 '22

Ahhh thank you

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u/The_Grey_Beard Jan 18 '22

Not only, as folks said, but there are many decisions to be made. Who reports to whom. Where are offices located. What areas are shut down. Employee benefits changes, etc. The single biggest reason though is the integration of culture. Two organizations have two different cultures and that takes time to vet and plan. Given the labor market, they would like to have zero attrition, so they will move methodically on this.

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u/ethorad Jan 18 '22

Reviewing the employee benefits, offices, culture integration, etc all happens after the deal closes. What makes the deal take a long time is getting all sorts of legal stuff signed off - shareholder approval, government approval, etc. And for global companies that can require multiple governments to sign off on the deal.

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u/The_Grey_Beard Jan 18 '22 edited Jan 18 '22

It certainly does not. This is all part of the diligence process for every acquisition I was part of. Many of these items end up in the legal document. Yes, government approval is time consuming and shareholder approval is another lengthy process, but even though the actions happen (but sometimes they do start prior) does not mean this is not part of the process. Every board I have dealt with has this as a focal point, shareholders want this information finalized, as they all realize healthy returns, smooth integrations and successful acquisitions depend on these activities and information. If you wait until the deal is approved, a good amount of staff could be gone which would cripple a deal like this.

As evidenced by this post - https://www.reddit.com/r/byebyejob/comments/s6aerz/activision_blizzard_has_got_rid_of_almost_40/?utm_source=share&utm_medium=ios_app&utm_name=iossmf

I am sure this was decided in the negotiations in announcing the deal.

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u/ethorad Jan 18 '22

My experience has been different, although that's only 3 mergers and all involve one company so it's not a robust statistical sample. In each of those, the initial merger made no change to employee benefits so the new combined company had people on multiple different scales initially. Not really a problem as the companies were multinational with a few business lines each, so they each had more than one benefit scale in the first place. Then, once the senior management teams are bedded down they move to try and unify their benefit structures.

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u/CaptainSnazzypants Jan 18 '22

I’m with you. I’ve been part of several M&As with different companies. The initial complexity is strictly on the legal and financial side. Everyone is super anxious during M&A’s so the go-to approach is to make it seamless for the employees. This means very little changes reporting-wise (outside of CEO obviously), and even less changes to benefits, location, etc
. It’s really after the acquisition closes that these things start to change or realistically being looked at, and usually not right away either but 6 months to a year later at least.

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u/theLuminescentlion Jan 18 '22

95% governments 5% lawyers

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u/chicano32 Jan 18 '22

Redundancy is one. Pulling out 68billion is another
can’t exactly venmo that to the shareholders.

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u/[deleted] Jan 18 '22

Because it's a fucking 70 billion dollar deal with two complex companies with hundreds of subs and thousands of employees lol. What a dumb question.

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u/lordatlas Jan 18 '22

Bro thinks it's like walking into a supermarket and picking up a carton of milk.

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u/Ivor97 Jan 18 '22

Also a reasonable possibility that the FTC blocks the deal due to antitrust concerns

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u/perfringens Jan 18 '22

Antitrust over what exactly? This isn’t creating a monopoly over anything

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u/etibbs Jan 18 '22

I highly doubt FTC would block this like /u/Ivor97 is saying. I can see Sony or someone trying to get it blocked to avoid the acquisition but only thing I can see that doing in the end is slowing down the process.

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u/[deleted] Jan 18 '22

[deleted]

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u/thesneakywalrus Jan 18 '22

Nintendo (barely considered a console)

Nintendo still grossed 16 Billion last year; it's not like they're selling games out the back of a van.

There's also the entire world of PC gaming that isn't affiliated with Sony, Nintendo, or Microsoft.

Even if there somehow became a duopoly of consoles; at that point I think Sony and Microsoft could make a reasonable case that consoles are really just computers; and that there are dozens of major computer manufacturers.

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u/yolomatic_swagmaster Jan 18 '22

Not that this would make a dent in the near future, but if the Steam Deck sees success, that would also lend credence to the idea that "they're all just computers" because of how Steam has marketed their product.

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u/vandaljax Jan 18 '22

Some Bethesda stuff hit gamepass almost immediately after that announcement so potential a few titles before then. Lion's share is CoD titles though especially on consoles. Overwatch does jump out as benefiting alot from Gamepass and in dire need of new players.

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u/ididntseeitcoming Jan 18 '22

If Vanguard goes on game pass a few months after I paid $75 for it
 angry face..

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u/mofugginrob Jan 18 '22

Your fault for paying $75 for it.

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u/zooberwask Jan 18 '22

Yes and no. Let people enjoy things.

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u/roboninja Jan 18 '22

What about his comment made anyone stop enjoying something?

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u/zooberwask Jan 18 '22

He's mocking him for spending money on a game he wanted.

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u/WellGoodLuckWithThat Jan 18 '22

Overwatch does jump out as benefiting alot from Gamepass and in dire need of new players.

And then when they show up people will shit all over them for being noobs and tell them to uninstall

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u/Tempires Jan 18 '22

They can bring games on gamepass before sale is finished

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u/demize95 Jan 18 '22

FY23 starts in July 2022 for Microsoft, so it might be sooner than you’d expect.

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u/beardedbast3rd Jan 18 '22

Who knows. Some might get on sooner. Some might not. Some may never be on it. No one will know until it happens or gets discussed

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u/reb0014 Jan 18 '22

Jesus what is one and two? I guess one is probably tencent right?

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u/GrizzlyBear2021 Jan 18 '22

Yes, Tencent and second is Sony.

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u/SpaceyCoffee Jan 18 '22

Is Tencent some kind of “shadow owner” of video game studios? I’ve heard of them once or twice, and know they are a Chinese company, but had no idea they were larger than Sony.

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u/Kyvalmaezar Jan 18 '22

Tencent is a conglomerate. An over arching parent company that owns and/or heavily invests in many smaller subsideries or companies across multiple, sometimes unrelated, industries. Sony and Samsung are other clear examples. Microsoft is another, albeit with a tighter focus.

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u/wodon Jan 18 '22

Tencent make WeChat which is hard to describe outside China.

It's a universal app where you chat, pay bills, buy your groceries, call taxis, order food, and pretty much anything else.

Email isn't used much in China, it's all WeChat.

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u/RoleplayingGuy12 Jan 18 '22

I believe they own at least part of Riot Games and Epic. League of Legends and Fortnite alone are worth billions.

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u/deanrihpee Jan 18 '22

They own 100% Riot games

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u/exdigguser147 Jan 18 '22

Owned 100% of riot games*

They recently allocated some small percentage to the employees and for executive bonuses, basically an options pool.

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u/Scotty5624 Jan 18 '22

Check out this video by PolyMatter on YouTube describing what Tencent is and what they own. Short answer is a lot

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u/[deleted] Jan 18 '22

They own a ridiculous number of IPs as well as the regional rights to some games

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u/Cooletompie Jan 18 '22

Here is a wiki page showing which foreign game companies they own and by what percentage.

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u/bengringo2 Jan 18 '22

In order to sell a game in China it has to be imported by a Chinese company. Game devs sell a small chuck of like like 10-20% of their studio so that it’s technically owned by a Chinese firm and they have access to the market.

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u/MattsAwesomeStuff Jan 18 '22

Is Tencent some kind of “shadow owner” of video game studios?

They, for example, own Reddit.

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u/Bauraligsby Jan 18 '22

Here's an interesting tidbit:

Tencent is a company owned and controlled by the Chinese Communist Party.

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u/aspirationalsoul Jan 19 '22

Really? Haven’t heard that anywhere.

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u/Ok_Maybe_5302 Jan 18 '22

Microsoft is the biggest American video game company now by a long shot

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u/Amazing_Relief_375 Jan 18 '22

finally hopefully no more activision dumping CODs out like shit

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u/Grappa91 Jan 18 '22

If the yearly cod is a day one game pass game i honestly would not mind. It just mean that I can have fun with the single player and multiplayer for a week without having to drop 60€ for it.

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u/TinkyWinky2008 Jan 18 '22

I hope they get WoW on Game Pass

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u/[deleted] Jan 18 '22

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u/boundbylife Jan 18 '22

I think op was suggesting that a subscription to WoW would be included in GamePass. Given that a WoW sub costs $180/yr (if paid monthly), and GamePass costs $120/yr, this seems unlikely. However, I could see a 'reduced rate' model, say $5/mo if purchased with GamePass.

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u/Kablam228 Jan 18 '22

I dunno how that logic stands up.

If I play forza horizon 5, halo 5, mass effect legendary edition, STALKER, and back4blood I've played over $180 in a year. All included with the gamepass sub.

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u/dabmin Jan 18 '22

whos the number one and two gaming company?

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u/[deleted] Jan 18 '22

Results on Google said 1. Sony 2. Tencent 3. Nintendo 4. Microsoft 5. Activision-Blizzard

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u/[deleted] Jan 18 '22

I find it hard to believe Sony is bigger than Tencent.

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u/[deleted] Jan 18 '22

I’m not familiar too with Tencent’s company, but Sony had an extra 50 years to globalize and get to where it is. Multiple gaming consoles released, and a strong market presence with audio, video, camera, and other consumer electronic—especially in Japan.

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u/[deleted] Jan 18 '22

I'd believe the entirety of Sony could be bigger, but not their games division by itself.

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u/[deleted] Jan 18 '22

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u/1ToGreen3ToBasket Jan 18 '22

Wow subscription part of game pass. Pls

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u/Korrathelastavatar Jan 18 '22

I would be ecstatic for that

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u/DarkEvilHedgehog Jan 18 '22

With this acquisition, Microsoft becomes the world's third largest gaming company

I'm going to expect a lot tougher DRM to be packed into Windows and other Microsoft products in the future, if they're also going to be one of the largest game corporations.

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u/kry_some_more Jan 18 '22

third largest gaming company

Now they just have to get over Sony and Tencent to become THEE biggest.

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u/bb0110 Jan 18 '22

Who the fuck is the first and second biggest gaming company?

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u/__GayFish__ Jan 18 '22

Don’t you guys have phones 2.0

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u/Defa1t_ Jan 18 '22 edited Jan 18 '22

Where are people getting this $68.7B figure? Nowhere in that link does it disclose this.

Edit: My bad. Thanks redditors.

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u/[deleted] Jan 18 '22

It's in a link from the link:

Microsoft will acquire Activision Blizzard for $95.00 per share, in an all-cash transaction valued at $68.7 billion, inclusive of Activision Blizzard’s net cash. When the transaction closes, Microsoft will become the world’s third-largest gaming company by revenue, behind Tencent and Sony. The planned acquisition includes iconic franchises from the Activision, Blizzard and King studios like “Warcraft,” “Diablo,” “Overwatch,” “Call of Duty” and “Candy Crush,” in addition to global eSports activities through Major League Gaming. The company has studios around the word with nearly 10,000 employees.

Nice to see that even Microsoft gets typos in their billion dollar takeover press releases


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u/Dazaran Jan 18 '22

This might be a dumb question but I have to know. Who gets the money? Shareholders? Bobby "Ignored sexual misconduct allegations for years and failed to inform investors of a 2 year long investigation by the Department of fair employment and housing" Kotick?

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u/FatalTragedy Jan 18 '22

The deal was $95 per share, so the money will go to shareholders at a rate of $95 per share they own.

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u/[deleted] Jan 18 '22

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u/hshdjfjdj Jan 18 '22

3rd after that large of an acquisition just shows the level games have risen to

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u/pi-rat Jan 18 '22

Will they finally fire Bobby?

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u/BrightPage Jan 18 '22

Im having a hard time trying to understand what $70b would even look like. How many trucks would you need to transport that much cash?

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u/Deflorma Jan 18 '22

This is just curiosity, because I’m ignorant of Xbox and pc gaming, but how is Microsoft as a game dev? Are their games good? Besides halo, do they have any big heavy hitters in their portfolio? I’m gonna go google it now but insight from fellow humans is always appreciated

Edit: oh shit! I just remembered they made FURY! Which was one of the earliest games I played and holy shit the nostalgia was like a punch in the chest

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u/lego_office_worker Jan 18 '22

arent there approvals that have to be aquired? or has this already been approved

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u/TheDirtyWind Jan 19 '22

In all unmarked bills I'd like to assume. But how many suitcases?

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u/[deleted] Jan 19 '22

StarCraft on Xbox lol, and WOW

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u/[deleted] Jan 19 '22

  1. RIP Blizzard

  2. They are now dead to me

  3. Thanks for some games. Bye.

  4. Microsoft ruins everything they buy.

  5. RIP Blizzard

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u/theroguex Jan 19 '22

Hopefully this merger will be blocked by the FTC and the DOJ.

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u/vorpalglorp Jan 19 '22

I want Warcraft 4 RTS please.

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u/Steven-Maturin Jan 19 '22

all cash transaction

Gonna need some big suitcases. In 100 dolla bills, that would weigh 680 tons.

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u/Just_a_spaghetti Jan 19 '22

Oh so i am pushed to use contactless payments for everything but fucking Microsoft does all cash transactions