Microsoft has recently acquired Activision Blizzard, marking the most expensive acquisition for the gaming industry. Despite many hurdles, the giant finally managed to close the deal, so it now owns more than 13 $1 billion franchises.
Following this massive deal, mergers and acquisitions in the game industry are expected to increase steadily over the next year. Axios has reported Michael Metzger’s opinion on the following matter.
Why it matters: The gaming industry’s landscape has shifted over the last few years. Consolidation is more popular than ever, with the likes of Tencent and Embracer Group buying well-known developers in big numbers.
Drake Star partner Michael Metzger said:
“we expect the deal volume to increase steadily over the next year.”
According to the report, Drake Star was able to track down 33 M&As between July and September that were worth $5 billion. Additionally, the team tracked down around $1 billion worth of investment from the industry during Q3.
According to Michael Metzger, Sony, Take-Two, Tencent, and more will be among the biggest investors. On the other hand, we believe Microsoft will lay low for a while after completing its $68.7 billion purchase.
The report also believes Embracer will continue to get rid of a few more studios after recently shutting down the likes of Volition Games.
Other sources also believe Sony will respond to Microsoft’s latest acquisition with a merger of its own. The gaming giant has previously purchased studios like Bungie and Insomniac Games, but nothing that could rival a major publisher like Activision Blizzard.
We believe Microsoft’s latest move will leave a lasting impact on the industry. The floodgates for major industry-wide acquisitions are now open, encouraging others to contemplate similar deals.
Sony is already on good terms with many publishers. The likes of Square Enix have worked closely with the gaming giant for decades, leading to speculations about a potential acquisition since last year.
Nonetheless, it seems the industry will continue toward the path of consolidation. Since Microsoft is now doubling down on its gaming efforts, others will likely follow suit, bolstering their internal teams with new additions in the process.
Obaid is pursuing a Law degree, while working as a content writer. He has worked as a gaming writer for over a year because of his passion for the medium and reporting the latest updates in the industry. Having played hundreds of games, Obaid finds himself coming back to Elden Ring and Red Dead Redemption 2, with these games being among his favorites. He has also been mentioned on highly regarded websites, such as Wccftech, Metro UK, PS Lifestyle, GamePressure, VGC, and Gamespot.