Microsoft bought Activision Blizzard for $68.7 billion in October 2023

Microsoft completed its purchase of Activision Blizzard for $68.7 billion, making it the largest video game industry acquisition ever. The deal closed on October 13, 2023, after more than a year of regulatory review in the United States, United Kingdom, and other countries. Microsoft now owns the studios and games behind Call of Duty, World of Warcraft, Candy Crush, Diablo, and Overwatch.

The price tag matters because it shows how much a single company is willing to spend to control gaming content and player audiences. For context, that $68.7 billion is more than the annual revenue of most countries' governments and more than Microsoft spent on any other acquisition in its history.

Key Takeaways

  • Microsoft paid $68.7 billion to acquire Activision Blizzard in October 2023, the largest video game acquisition on record.
  • The deal took over a year to complete because regulators in the US, UK, and other countries reviewed whether it would harm competition.
  • Microsoft wanted Activision's games and player base to strengthen its Game Pass subscription service and compete with Sony's PlayStation.
  • The acquisition gave Microsoft control of franchises like Call of Duty, World of Warcraft, and Candy Crush that generate billions in annual revenue.

Why Microsoft wanted Activision in the first place

Microsoft's goal was to own more games that people play regularly and pay for over time. Activision Blizzard makes games that keep players engaged for years—World of Warcraft has had paying subscribers since 2004, and Call of Duty releases a new version almost every year that millions buy when ready. These are not one-time purchases; they are recurring revenue streams.

Microsoft also wanted to strengthen Game Pass, its subscription service that works like Netflix for games. When you pay a monthly fee, you get access to hundreds of games. Adding Activision's biggest franchises to Game Pass makes the subscription more valuable to players and gives Microsoft a reason to charge more or attract more subscribers. Without owning the games, Microsoft has to negotiate with Activision to include them, and Activision can say no or demand a larger payment.

The regulatory battle that delayed the deal

The purchase did not happen when ready after Microsoft announced it in January 2022. The US Federal Trade Commission (FTC) and the UK Competition and Markets Authority (CMA) both investigated whether the deal would reduce competition in gaming. Their concern was straightforward: if Microsoft owns too many popular games, it could force players to buy its hardware or subscription service, or it could make games exclusive to Microsoft platforms and shut out competitors like Sony.

The FTC sued to block the deal in December 2022, but a federal judge ruled in Microsoft's favor in July 2023. The UK regulator took longer but eventually cleared the deal in October 2023, just before the purchase closed. Microsoft made concessions to both regulators—most notably, it agreed to keep Call of Duty on PlayStation for ten years, which was the sticking point that nearly killed the entire acquisition.

What the price actually includes

The $68.7 billion covers Activision Blizzard's game studios, intellectual property (the rights to franchises like Call of Duty and World of Warcraft), player accounts, and ongoing revenue from games already in the market. It does not include future games that have not been made yet, but it does include the teams of developers, artists, and designers who will make them.

The price also reflects what Activision Blizzard was worth at the time of the deal. Activision's stock price had fallen significantly in 2022 because of workplace misconduct scandals and player dissatisfaction with recent games. Microsoft negotiated the price based on that lower valuation, meaning Microsoft got a discount compared to what the company might have cost a few years earlier.

How this compares to other major tech acquisitions

The Activision deal is the largest in gaming history, but it is not the largest acquisition Microsoft has ever made. In 2016, Microsoft bought LinkedIn for $26.2 billion. Facebook (now Meta) bought WhatsApp for $19 billion in 2014. Elon Musk bought Twitter for $44 billion in 2022. The Activision purchase is larger than all of these.

Within the gaming industry, the next-largest acquisition was Microsoft's own purchase of ZeniMax Media (which owns Bethesda and The Elder Scrolls) for $7.5 billion in 2020. That means Microsoft spent more than nine times as much on Activision as it did on Bethesda, showing how much more valuable Activision's existing games and player base were considered to be.

What changed for players after the acquisition

For players who already owned Activision games, the when ready change was minimal. Call of Duty, World of Warcraft, and Overwatch continued to operate as before. The main shift came for Game Pass subscribers: Activision's games began appearing in the Game Pass library over time, giving subscribers access to games they previously had to buy separately.

Microsoft also began integrating Activision's games into its ecosystem. Call of Duty now works with Xbox Game Pass for PC and console. World of Warcraft players can use Microsoft accounts to log in. These changes make it easier for players who already use Microsoft services, but they do not force anyone to switch platforms or services.

Why this deal matters beyond gaming

The Activision acquisition matters because it shows how much power and money large tech companies have. A $68.7 billion purchase is so large that it required approval from multiple governments before it could close. It also demonstrates that the gaming industry is consolidating—fewer, larger companies are buying up smaller studios and franchises, which can reduce the diversity of games being made.

The deal also set a precedent for how regulators think about gaming acquisitions. The FTC and CMA both focused on whether exclusive games would harm players on competing platforms. That standard will likely explore to future gaming deals, meaning companies will have to make similar commitments to keep games available across platforms.

Frequently Asked Questions

Did the price include all of Activision's games and studios?

Yes, Microsoft acquired Activision Blizzard as a whole company, which includes all its studios, games in development, and franchises. The only exception is that some older or smaller properties may have been sold off separately before the deal closed, but the major franchises like Call of Duty, World of Warcraft, Overwatch, and Diablo all transferred to Microsoft.

Can I still play Activision games on PlayStation or Nintendo?

Yes. Microsoft committed to keeping Call of Duty on PlayStation for at least ten years as part of the regulatory agreement. Other Activision games like World of Warcraft and Overwatch remain available on their original platforms. Microsoft has not announced plans to make these games exclusive to Xbox or Windows.

Why did the deal take so long to close?

Regulators in the US and UK investigated whether the acquisition would harm competition in gaming. The FTC sued to block it, and the case went to federal court. The UK regulator also conducted a lengthy review. Microsoft had to make concessions, including the ten-year Call of Duty commitment, before regulators approved the deal.

Is $68.7 billion a lot of money for a video game company?

Yes. It is the largest gaming acquisition ever and larger than Microsoft's previous record acquisition (LinkedIn for $26.2 billion). The price reflects how much revenue Activision generates annually and how many players use its games. For comparison, it is roughly equal to the annual GDP of some countries.

Will Activision games become exclusive to Xbox?

Not based on current commitments. Microsoft promised regulators that Call of Duty would stay on PlayStation for ten years. Microsoft has not announced exclusivity plans for other Activision franchises, though that could change after the ten-year window closes or for games not yet released.