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Explained: Why Microsoft buying Activision Blizzard gives it a firmer footing in metaverse space

With the acquisition of Activision Blizzard, Microsoft will have in its kitty games such as Call of Duty, Warcraft, Candy Crush, among others

Written by Aashish Aryan , Edited by Explained Desk | New Delhi |
Updated: January 20, 2022 2:12:02 pm
Microsoft has been trying to become a major player in the gaming industry for quite some time now. (Reuters)

Microsoft on Tuesday announced it was acquiring gaming company Activision Blizzard for $68.7 billion. With this, Microsoft will become the world’s third-largest gaming company by revenue, behind Tencent and Sony. The acquisition is also seen as a major push for metaverse.

Why is gaming seen as an entry for companies into metaverse?

For most software and social media conglomerates across the world, metaverse is the next step in the evolution of internet. Though it can have varied definitions, the simplest explanation for metaverse is that it is a virtual world where the avatars or online identities of people can interact.

This means that instead of just viewing or listening to content on internet, people can be inside the world of internet, creating content in real-time for others, while also experiencing the same.

One of the first and major applications of this would be games. For example, games in which players can team up with players from other parts of the world through internet will evolve to be more interactive. Instead of choosing from a set of pre-defined characters, players can chose to build their own avatars, which look just like them.

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Further, this can be scaled to build communities, commercial spaces, shops and malls from where the avatars built by people in their games can be used to explore or purchase stuff from the comfort of their homes. For this to work, however, metaverse built by different companies and social media conglomerates will have to be interoperable.

The second major application will be in the live sports and entertainment industry. Both these industries have taken the first step towards a metaverse by using virtual and augmented reality-based headsets and devices for broadcasting sports events as well as music videos and movies.

Why is Microsoft’s acquisition of Activision Blizzard a major push for metaverse?

Microsoft has been trying to become a major player in the gaming industry for quite some time now. Though it has the Xbox console, it has not been able to crack the interactive game software area as well as some other companies, such as Zynga, which was also acquired by Take-Two Interactive, the maker of Grand Theft Auto.

With the acquisition of Activision Blizzard, the company will have in its kitty games such as Call of Duty, Warcraft, Candy Crush, Tony Hawk, Diablo, and Overwatch, among others. While these games will be available on the Xbox console, they can be further tweaked to enable players to enter the virtual world of metaverse with the help of Microsoft’s Hololens.

Facebook, which has since last October re-branded itself as Meta, has also been working on a virtual world where the users of its different platforms can create avatars and interact with various other characters and well as commercial spaces.

Though the company has games on its platform as well, it has so far focused on making social media and workplaces that will have continuity irrespective of the location of the person.

With Activision Blizzard in its side, Microsoft will be able to scale up its presence in this area by extrapolating the learnings from the gaming platform for other users as well, an industry expert said.

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