Microsoft Buys Activision Blizzard For $70 Billion, Activists Cry Foul

Microsoft is buying Activision Blizzard, developer of Call of Duty and Candy Crush for just under $70 billion. The all-cash deal should be finalized during the 2023 fiscal year.

The deal turns the Xbox making Microsoft into a contender to be one of the world’s top video game companies, surging in front of Nintendo. Now, Microsoft is just behind Sony, maker of Playstation and Chinese tech company Tencent, according to Wedbush Securities analyst Daniel Ives.

Activision has been at the forefront of the gaming world since the ’80s, creating or acquiring the most popular games at the time.

“Microsoft needed to do an aggressive deal given their streaming ambitions and metaverse strategy,” Ives said. ”They’re the only game in town that can do a deal of this size with the other tech stalwarts under massive tech scrutiny.”

After losing out on acquiring Tik Tok a year and a half ago, reports are that Microsoft CEO Satya Nadella wanted to get a big acquisition done. This deal has not come without skepticism from antitrust regulators.

“No way should the Federal Trade Commission and the U.S. Department of Justice permit this merger to proceed,” a statement from Alex Harman, competition policy advocate for Public Citizen, said. “If Microsoft wants to bet on the ‘metaverse,’ it should invest in new technology, not swallow up a competitor.”

Activision is under investigation after internal allegations of a toxic work environment and discrimination, especially toward women. The state of California sued Activision for having a “frat boy” culture that included sexual harassment, inadequate discipline and gender-based discrimination leading to an unfair pay gap.

“The culture of our organization is my number one priority,” Nadella said in a conference call with investors. “It’s critical for Activision Blizzard to drive forward on its commitments to improve its workplace culture.”