Microsoft Goes on a TikTok Rebound Gaming Binge

Microsoft splashed out $7.5bn on ZeniMax Media
Charlie Richardson
8 February 2021
Microsoft Goes on a TikTok Rebound Gaming Binge

What happened and why Microsoft (+0.09%) went on the TikTok re-bound, fast. The Xbox-owner splashed out $7.5bn on ZeniMax Media, the gaming umbrella company behind blockbusters such as Doom, Fallout, Skyrim and Wolfenstein. Microsoft mandate has been to play in high-growth sectors. And gaming, especially in a lockdown-ridden world, is definitely that. Microsoft chief, Satya Nadella, has been peddling the company's push into gaming since he landed the hot-seat in 2014. The man credited with transforming the tech-giant, claims the gaming market is now worth more than Hollywood and the music industry combined... Big entertainment... Microsoft projected gaming industry revenues will surpass $200bn next year, making it “the most expansive category in the entertainment industry”.All-cash deal... ZeniMax Media is Microsoft’s third-largest acquisition behind LinkedIn and Skype, and matching the $7.5bn it paid for GitHub in 2018. ⏱️ How about that timing... The deal was announced on Monday, just a week after Microsoft’s bid to purchase TikTok fell through, and one day before pre-orders start for two new Xbox consoles. Not leaving gamers with much time to stew on quite a lot... Game Pass... Xbox has said that the publisher's franchises would be added to its Game Pass subscription package (which includes access to 200 games) for consoles and PCs.Winning over the swing gamers... With both Playstation 5 and Xbox landing in November, including the newly-acquired titles in Microsoft's "ultimate" package, could be key to winning over Playstation customers.

Taking on the new games titles is one thing but Microsoft will now also own the id Tech games engine, developed by Bethesda (part of the Zenimax group). But what comes next is less clear. Will Microsoft make Bethesda’s franchise games exclusive to Xbox and PC... shutting out PlayStation is the process? | The Takeaway 🎮 It's the game the counts... and Microsoft knows it. Gamers are a tribal bunch and industry consumers' are notoriously hard to convince to switch platform. Microsofts' pursuit to own the gaming content creation (while the rest of big tech eats away at Hollywood), may be a play to tap into customer gaming loyalty sat built-up by blockbusters such as Fallout. If the user base continues to grow, don't be surprised if Bethesda becomes a Xbox-exclusive.