Microsoft's $69 Billion Blunder Deal...!?

Sindujaa D N

The tech behemoth is acquiring a company plagued by workplace scandals and game quality complaints. Regulators will be looking closely as well.



On tuesday, the technology behemoth announced a $69 billion cash deal to acquire Activision Blizzard Inc. If the transaction goes through, it will be the largest acquisition in the company's history.



Is this, however, a wise investment?

At first glance, the merger appears to make sense. Gaming is one of the largest and fastest-growing consumer businesses, and it is a rare area where a multibillion-dollar company like microsoft can make a difference.



Microsoft will gain many well-known franchises, including Warcraft, Diablo, Overwatch, Call of Duty, and Candy Crush, as well as nearly 10,000 experienced gaming employees, by acquiring Activision.



The large back catalogue of games from Activision will make Microsoft's Game Pass subscription service more appealing. However, there are several major issues with the proposed agreement.



For starters, some of the video game company's top talent may have already left. Activision has been experiencing a serious workplace culture crisis under longtime CEO bobby Kotick.



Multiple government investigations have been launched against the company for failing to protect female employees from sexual harassment and discrimination.


Second, microsoft may be paying too much. Call of Duty is Activision Blizzard's most important franchise financially, and it may be in trouble.



Activision was forced to apologise last week for widespread technical issues in several recent Call of Duty games. For weeks, gamers have been complaining on Reddit about glitches, crashes, and bugs.



On a conference call with analysts tuesday morning, microsoft executives stated that the acquisition was not motivated by short-term results, but rather by the long-term potential of Activision's franchises.



However, even looking ahead a few years, the company may be underestimating the level of damage Activision's brands have suffered as a result of both workplace scandals and game quality complaints.



But, if Meta is being scrutinised for minor acquisitions, it begs the question of why microsoft should be permitted to acquire multiple large companies.

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