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Microsoft's Activision purchase bolsters metaverse efforts against Zuckerberg's Meta

Microsoft announced plans to acquire video game maker Activision Blizzard for an eye-popping $68.7 billion in an all-cash deal on January 17.

January 19, 2022 / 11:55 AM IST
(Image: Shutterstock)

(Image: Shutterstock)

If Microsoft dominated the desktop platform, it lost out the mobile computing wars to rivals Apple and Google.

The software giant is now staking claim to shape what is being billed as the next big computing platform - the metaverse.

Broadly, metaverse is a virtual world where you will be able to interact with your friends and colleagues in digital avatars.

On January 11, Microsoft CEO Satya Nadella had said that metaverse is the next big thing for the firm.

These ambitions became clearer when the software giant announced plans to acquire video game maker Activision Blizzard for an eye-popping $68.7 billion in an all-cash deal on January 17.


It's worth noting that Microsoft already owns the popular sandbox creator game Minecraft, which Microsoft Gaming CEO Phil Spencer thinks is a blueprint for the metaverse.

Read: Explainer | What is a Metaverse and why is everyone talking about it?

This deal could further boost the firm's efforts against Mark Zuckerberg's Meta which has been one of the biggest proponents of the metaverse, so much so that the social media firm recently changed its corporate name from Facebook to Meta and plans to spend at least $10 billion on building this platform.

Why a gaming company, you ask?

Irrespective of what version the so-called metaverse eventually takes in the future, it will likely have strong roots in gaming.

This is because gamers already understand the significance of a virtual avatar as well as buying virtual skins and gifts, which are going to be key components of a future digital economy in the metaverse.

"Gaming is the largest and fastest-growing form of entertainment, and as the digital and physical worlds come together, it will play a critical role in the development of metaverse platforms," Nadella said in a letter to employees.

In a conference call discussing this transaction, he said they believe "there won’t be a single, centralised metaverse and there shouldn’t be".

"We need to support many metaverse platforms, as well as a robust ecosystem of content, commerce and applications. In gaming, we see the metaverse as a collection of communities and individual identities anchored in strong content franchises, accessible on every device," Nadella added.

As part of the gaming deal, Microsoft will get access to several franchises like World of Warcraft, Diablo, Overwatch, Call of Duty and Candy Crush. Activision Blizzard claims to have nearly 400 million monthly active players across 190 countries.

Microsoft said it will have 30 internal game development studios across the world, along with additional publishing and esports production capabilities, once the deal closes.

Meanwhile, Zuckerberg had also previously said that gaming and entertainment are going to be a big part of the metaverse.

Over the past couple of years, Meta has been on an acquisition spree, snapping up virtual reality (VR) firms such as Within (makers of Supernatural VR fitness app), BigBox VR (Population: One and Smashbox Arena), Downpour Interactive (Onward), Unit 2 Games (free-to-play game creation and sharing tool Crayta), Ready at Dawn (Lone Echo and others), Beat Games (Beat Saber), and Sanzaru Games (Asgard’s Wrath and others).

On December 9, Meta opened its social VR platform Horizon Worlds to all users above the age of 18 in the United States and Canada. The platform allows users to build new digital spaces (worlds) or experiences, discover new places with their friends, or form teams to solve puzzles among others.

ReadIndia could play a key role in shaping our metaverse efforts: Meta's Vishal Shah

Enterprise play

Microsoft's efforts are also likely to extend to other areas such as workplace environments, helping professionals to work and collaborate remotely in an effective manner.

Microsoft recently said it was building capabilities for both consumers and enterprises to access the metaverse.

During the company’s event in November 2021, Microsoft announced that it will launch Mesh for Microsoft Teams, the firm’s video-conferencing platform, which will be the gateway to the metaverse.

Set to launch in the first half of 2022, Mesh enables people to create their own digital avatars and interact/collaborate in a virtual environment, say a virtual office space, simply by plugging into VR headsets or mixed reality headsets like Microsoft’s HoloLens.

“Human presence is the ultimate connection. You and I can have a meeting where we are all present together without actually being physically present. That's the next thing and we are approaching this thoughtfully,” Nadella said.

Microsoft had also previewed a new product called Dynamics 365 Connected Spaces, which lets people move and interact within retail and factory spaces.

Meanwhile, Meta has launched an open beta version of Horizon Workrooms, a VR experience meant to facilitate remote work collaboration and business meetings in August 2021.

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Vikas SN
first published: Jan 19, 2022 11:45 am
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