Microsoft Is Aiming To Be The Netflix Of Gaming (Part 1)

Summary

• ZeniMax Media was bombshell acquisition.
• The Xbox brand has done a 180 in the court of public opinion.
• Microsoft just might be able to nail this transition.

The Bombshell 

7.5 Billion, easily the largest acquisition in console gaming history, has the potential to move Microsoft to the very forefront of the video game industry.  

(Courtesy: ZeniMax Media)

Earlier this week (9/21/20 to be specific), Microsoft dropped a nuke on the gaming market. One of the most prevalent collection of studios had been acquired by the Redmond-based giant. As someone who follows the gaming industry, I never expected an acquisition of this size. 

While I won't touch on all the studios, I will highlight that this includes major ones like Arcane, iD Software, MachineGames, and most importantly Bethesda Softworks. 

These studios produce some of the most iconic and celebrated franchises in modern gaming, including: Dishonored, Doom, Wolfenstein, The Elder Scrolls, and Fallout.

(Courtesy: Microsoft)

For investors that may not be up-to-date on gaming, this is similar to Disney purchasing Marvel. Seemingly overnight, Xbox has gain ownership of some of the largest multi-platform gaming experiences. Perhaps they will be future Xbox exclusives, but there is a chance that they will not. Nevertheless, this puts Microsoft's gaming division in a wonderful position going forward. 

The Redemption of Xbox 

After a mediocre showing this for this generation of home consoles, Xbox definitely needed a shot in the arm to close the gap with Playstation. Through superb value, and a string of acquisitions, Xbox has been at work building back a loyal consumer base.  

Announcing an acquisition of this this size has given the Xbox brand an incredible amount of free advertising the day before preorders for the next Xbox console were supposed to come online. Every gaming website, blog, and video game personality has been covering and dissecting the news. As of 9/22/20, apparently this strategy has worked, as all next-gen Xbox preorders appear to be sold out. 

Untapped Potential

It's no secret that video games have been trending in the digital direction for decades, and moving to streaming simply seems like the next logical step. While video game streaming is still in a very infantile stage, in my opinion, it has the potential to be bigger than Netflix. On the plus side, Microsoft may finally have an early mover's advantage in an area. At the very least, they finally seem focused in one direction on the gaming front.

(More on this in a later post)

While it is too early to truly estimate the value of this acquisition. The importance of the IP and backlog of games cannot be emphasized enough. This acquisition provides incredible value to the consumer and all but confirms Microsoft's plan for their gaming division. 

I will continue to share my thoughts on this and predictions in future posts. I also plan to further flesh out the points addressed in this post, but everyone needs to start somewhere right? 

Thanks for reading my first blog post!