The Sony company fell more than 9% yesterday touched by the historical purchase carried out by Microsoft.

Currently, Sony is the leader in the video game sector, and now its hegemony is threatened. You are facing a monumental challenge. That is why many analysts recommend selling in the short term.

The real threat is that with the purchase of Activision Blizzard can make the firm’s games exclusive to the X Box console – obviously from Microsoft -, thus harming sales of the Sony console.

Activision Blizzard’s main sales are video game sales for PlayStation, which may complicate Microsoft’s intention to withdraw titles for Sony.

What is most likely for this scenario?

Most likely, Microsoft will try to gradually lure PlayStation gamers to its own console with future new content.

Millionaire operation

The operation of the purchase of Activision Blizzard by Microsoft exceeded 68,700 million dollars.

With this purchase, Microsoft becomes the third largest video game company in the world.

Next I will explain the scenarios that Microsoft’s master move will leave.

Scenario 1 – An impressive catalog + talent –

Activision Blizzard’s catalog is really important. Within its catalog we can find the video game: Call of Duty. The disproportionate success of this is due to the X Box, this indicates that both firms already understood each other previously. With this purchase Microsoft will incorporate 400 million users per month of Activision Blizzard.

Microsoft thus acquires the critical mass – the players -, and apart from that acquires 30 video game developer studios – talent and content creators -.

This is the most relevant, due to the contribution of these people, which is: testing the market, and seeing what can be successful (with this, it will generate more money).

Scenario 2 – The world of «gaming» and eSports

Microsoft makes a bet on entertainment. You know that «gaming» is the most dynamic category that exists at the moment within the field of entertainment. It is not the first time that Microsoft has bet on «gaming», in 2014 it acquired the video game «Minecraft» for a value of 2.5 billion USD, created in 2009 by the Swedish Markus Persson (commonly known as «Notch»).

But, it is not the only company that opts for the world of video games. In 2014, Amazon bought the Twitch company for USD 970 million, when Twitch originally only broadcast video game games.

Why future purchase of Activision Blizzard?

Because the «business» is now in electronic sports eSports, and in video games.

Currently, «gaming» is 6.5% of Microsoft’s business; With this purchase, the volume is expected to rise to 12%.

Scenario 3 – The Metaverse –

A company to enter the world of the metaverse needs two things: A and B.

A -> Everything related to work and the office, and this Microsoft already has in spades.

B -> Obviously what is not work is leisure. Thanks to incorporating a video game giant such as Activision, Blizzard will have a much easier time picking up the glove launched by Meta Platforms (formerly known as Facebook).

Scenario 4 – The most complex –

The operation will close in 2023, as it will be subjected to strict regulatory scrutiny by the US authorities.

These authorities will be: the department of justice, or the department of commerce.

The agencies that regulate the US monopoly go against Google, Facebook, and Amazon.

They will scrutinize Microsoft very carefully. However, it is an operation with more than two trillion market value that is going to be in the entertainment market.

The company has the devices, the content and the software.

They will judge whether or not the giant can harm the user.

Scenario 5 -Geostrategy –

As a final point, I will highlight the geostrategy of the operation, since with this operation it will stand up to China (Tencent) and Japan (Sony).

Miscellany

The recommendation is that they consider taking positions in the world of «gaming», closely follow the battle that is going to take place this year between the three giants. Remember to always analyze everything in an extremely broad and objective way; and, that the trees do not prevent them from seeing the forest.

«Uncertainty is the certainty of the visionary». David EPC

david-epc

David EPC ©

Todos los derechos reservados y copyright a nombre de David EPC.
Mr. D BOOKS.