How Much Did Microsoft Pay for Overwatch? Unpacking the Activision Blizzard Deal
Microsoft didn’t pay a specific, itemized price for Overwatch. Instead, Overwatch (along with franchises like Call of Duty, World of Warcraft, Diablo, and Candy Crush) came as part of a much larger acquisition. Microsoft acquired Activision Blizzard for a whopping $68.7 billion (originally announced at $68.7 billion, but finalized at $69 billion due to market fluctuations and deal closing costs). This means Overwatch was included as one of the many valuable intellectual properties within the Activision Blizzard portfolio. It’s impossible to break down exactly how much of that figure can be attributed to any single game.
Unpacking the Activision Blizzard Acquisition
The acquisition of Activision Blizzard by Microsoft is one of the largest in gaming history. It wasn’t just about acquiring individual games; it was about obtaining a vast library of established franchises, a large and talented workforce, and a stronger foothold in the overall gaming market, including mobile.
Microsoft’s motivations were multifold. They were looking to expand their Xbox Game Pass offerings, strengthen their position in the burgeoning cloud gaming space, and compete more effectively with rivals like Sony (PlayStation). Buying Activision Blizzard was a shortcut to acquiring a massive audience and a diverse catalog of titles.
Strategic Implications for Microsoft
The acquisition has profound implications for the gaming industry. Microsoft now controls some of the most popular games globally, which gives them significant leverage in negotiations with platform holders and publishers.
The deal also allows Microsoft to integrate Activision Blizzard’s franchises into the Xbox ecosystem. This could include making future titles exclusive to Xbox consoles and PC, or offering them as day-one releases on Xbox Game Pass.
Overwatch’s Role in the Acquisition
While Overwatch might not be the absolute biggest earner in the Activision Blizzard portfolio compared to Call of Duty, it represents a valuable asset. It’s a well-established franchise with a loyal fanbase and a history of strong revenue generation, even with the transition from Overwatch 1 to Overwatch 2.
Overwatch’s team-based gameplay and vibrant characters also fit well with Microsoft’s vision for creating engaging and accessible gaming experiences. You can further explore this and other developments in the gaming industry by connecting with resources and communities like the Games Learning Society, found at GamesLearningSociety.org.
Frequently Asked Questions (FAQs)
1. How much did Microsoft offer per share for Activision Blizzard?
Microsoft offered approximately $95 per share for Activision Blizzard in an all-cash deal.
2. Why did Activision Blizzard agree to be acquired by Microsoft?
Activision Blizzard likely agreed to the acquisition due to a combination of factors, including:
- The attractive financial offer from Microsoft.
- Potential future growth opportunities within the Microsoft ecosystem.
- The desire to address internal challenges and controversies within the company.
3. What was the biggest hurdle in the Microsoft-Activision Blizzard deal?
The biggest hurdle was regulatory approval from various government bodies around the world, including the UK’s Competition and Markets Authority (CMA) and the US Federal Trade Commission (FTC). Concerns were raised about potential anti-competitive practices and the impact on consumer choice. Ultimately, Microsoft successfully navigated these challenges.
4. Does Microsoft now own all Activision Blizzard games?
Yes, with the completion of the acquisition, Microsoft now owns all games and intellectual property belonging to Activision Blizzard, including Call of Duty, World of Warcraft, Diablo, Overwatch, and Candy Crush.
5. Will Call of Duty become exclusive to Xbox?
While Microsoft has stated its intention to keep Call of Duty available on PlayStation platforms for the foreseeable future, the long-term strategy remains uncertain. Microsoft has made legally binding agreements to keep the franchise on competing consoles for a certain period. This could change in the future.
6. How will the acquisition affect Overwatch 2 players?
In the short term, the acquisition may not have a significant impact on Overwatch 2 players. However, over time, we can expect to see more integration with the Xbox ecosystem, such as Xbox Game Pass availability and potential cross-platform play features.
7. Is Overwatch 2 profitable for Microsoft?
While specific figures for Overwatch 2’s current profitability are not readily available, Activision Blizzard reported that the game generated significant revenue in its first quarter. It is likely to be contributing to the profitability of Activision Blizzard under Microsoft’s ownership. The game brought in over $100 million in net bookings.
8. What were the revenues reported in 2023 for Activision and Blizzard?
Activision segment net revenues grew by 17% year-over-year, and Blizzard segment net revenues grew by 164% for the second quarter of 2023.
9. Will the acquisition change the development of Overwatch 2?
It’s possible that the acquisition will influence the future development of Overwatch 2. Microsoft may bring its resources and expertise to the game, potentially leading to new features, content, and improvements.
10. Did the original Overwatch owners get any benefits in Overwatch 2?
Yes, owners of the original Overwatch received a “Founders Pack” in Overwatch 2, which included a couple of skins, an icon, and instant access to the three new heroes. All heroes were unlocked along with Kiriko available to you (new hero in season 1).
11. Why did Overwatch 2 viewership drop so dramatically after launch?
The dramatic drop in Overwatch 2 viewership can be attributed to several factors, including:
- The initial hype surrounding the game’s launch subsiding.
- Player dissatisfaction with certain aspects of the game, such as the battle pass system and monetization.
- Competition from other popular streaming titles.
12. What is the state of the Overwatch League now that Microsoft owns the game?
The future of the Overwatch League is uncertain, as recent Activision Blizzard financial report for Q2 2023 indicated Overwatch 2 and Overwatch League are in decline.
13. How does Xbox make money?
Microsoft generates revenue from the Xbox business through a variety of channels, including:
- Console sales
- Game sales (both digital and physical)
- Xbox Game Pass subscriptions
- Microtransactions within games
- Advertising
14. How profitable was Elden Ring?
Elden Ring was very profitable for FromSoftware, resulting in about $152 million in sales, with an operating profit around $91 million.
15. What are Microsoft’s long-term goals with the Activision Blizzard acquisition?
Microsoft’s long-term goals include:
- Strengthening its position as a leader in the gaming industry.
- Expanding the reach of its Xbox Game Pass subscription service.
- Leveraging Activision Blizzard’s intellectual property to create new gaming experiences.
- Building a strong presence in the metaverse and cloud gaming spaces.
In conclusion, while a specific price for Overwatch within the Activision Blizzard acquisition cannot be isolated, the game is undoubtedly a valuable asset within Microsoft’s expanded gaming portfolio, contributing to their overall strategy and future growth.