On Monday, Microsoft announced plans to boost its Xbox offering by acquiring Zenimax Media, which owns several important gaming companies, for $7.5 billion.
Here are the details:
- Zenimax is the parent company of Bethesda Softworks, a major game publisher, and a number of high-profile game developers, including ID Software. Its games and franchises include The Elder Scrolls, Fallout, Doom, Quake, Wolfenstein, Prey, Dishonored, and the forthcoming Starfield.
- This will be Microsoft’s biggest video game acquisition to date, and its third-largest purchase ever (after Linkedin and Skype). The deal will expand the company’s creative studio portfolio from 15 to 23 and bring 2,300 employees into the fold. It’s expected to close in the first half of 2021.
- The deal spells out Microsoft’s ambitions in gaming, which CEO Satya Nadella calls “the most expansive category in the entertainment industry.” It was announced the day before pre-orders opened for two new Xbox consoles. Bethesda’s games will also be added to Xbox Game Pass, the company’s cloud-based streaming service, which has 15 million subscribers.
- Phil Spencer, head of Xbox, said in a blog post, “Just as they took the bold first steps to bring The Elder Scrolls franchise to the original Xbox, Bethesda were early supporters of Xbox Game Pass, bringing their games to new audiences across devices and have been actively investing in new gaming technology like cloud streaming of games.”
- The price tag is close to the $7.4 billion that Disney paid for Pixar in 2006. In a way, this deal mirrors that one: an industry titan is buying one of the biggest and most respected independent studios in the field.
- The acquisition will strengthen Microsoft’s offering in the face of stiff competition, especially from Sony, whose Playstation 5 launches in November — the same time as the new Xbox consoles. As for whether Bethesda’s future games will be kept as Microsoft exclusives or released on rival consoles, Spencer told Bloomberg the decision will be made “on a case-by-case basis.”
(Image at top: “The Elder Scrolls Online.”)