Coinspeaker
Microsoft’s Activision Blizzard Deal Tipped to Pioneer Era of New-Generation Gaming Companies

A recent deal saw tech giant Microsoft Corp (NASDAQ: MSFT) paying $69 billion to acquire US game publisher Activision Blizzard Inc (NASDAQ: ATVI). However, according to venture capital (VC) firm Konvoy, that Microsoft’s deal might just be the start of many more similar ones to come to gaming.

In a report that Konvoy partner Josh Chapman recently shared with CNBC, the world’s biggest tech firms still hold a combined $229.4 billion of cash on their balance sheets. He named Amazon, Apple, Google, Meta, Sony, Netflix, and China’s Tencent in the report, claiming that they have more than enough cash to close potential mergers & acquisition deals. About Microsoft’s recent deal, Chapman wrote:

“As active gaming investors, we believe that gamers and gaming startups stand to benefit from the deal as it improves the value-proposition for gamers and leads to a vibrant M&A environment for other deals to get closed.”

Chapman also noted cloud gaming as a key aspect of what Microsoft is bringing to the world of gaming. With cloud gaming services, gamers can say goodbye to the need for traditional consoles. Per Chapman, this new reality does not only benefit gamers. It also opens up “new opportunities for emerging game developers, infrastructure companies, and gaming platforms,” he noted.

Gaming Giants

Konvoy also reports that publicly listed gaming companies currently sit on about $45 billion pile of cash and cash equivalents themselves. And, with that much cash, more consolidation is expected in the $188 billion video games market.

In its report, Konvoy claims that Activision Blizzard, Electronic Arts, Singapore’s Sea, Japan’s Nintendo and Bandai Namco, South Korea’s Nexon, and China’s NetEase, currently hold $45.1 billion in cash and cash equivalents. The figure has been rounded up from the companies’ latest public reports. Notably, this amount gives the companies the financial backing they need to acquire companies that could help them expand their capabilities and build their products.

Coinspeaker reported earlier this month that the UK’s Competition and Markets Authority (CMA) had approved Microsoft’s blockbuster acquisition of Activision Blizzard. The deal was valued at $69 million and saw the tech giant gain ownership of some of the most popular names in video gaming. Some of them include Candy Crush, the Call of Duty franchise, Warcraft, and many more.

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Microsoft’s Activision Blizzard Deal Tipped to Pioneer Era of New-Generation Gaming Companies