Microsoft claims buying Activision Blizzard will help build ‘the next internet’

When Microsoft bought Activision Blizzard for almost $70 billion last month, the tech giant’s CEO Satya Nadella was quick to bring up the metaverse in his comments. “In gaming, we see the metaverse as a collection of communities and individual identities anchored in strong content franchises accessible on every device,” Nadella said. The company also noted the deal would “provide building blocks for the metaverse” in its statement.

But it still wasn’t quite clear where Nadella saw the link between building the metaverse and buying, in Activision Blizzard, a bunch of game studios and a huge catalog of intellectual property. Nadella tried to clarify his ideas by speaking to Financial Times.

“Metaverse is essentially about creating games,” the Microsoft boss said, noting the common concepts and technology between a virtual meeting and a video game. “It is about being able to put people, places, things [in]A physics engine, and all of the people, places, and things within it relate to one another.

“You and I will be sitting on a conference room table soon with either our avatars or our holograms or even 2D surfaces with surround audio. What’s the best part? That’s the place we have done that for forever! […]Gaming.

“And so, the way we will even approach the system side of what we’re going to build for the metaverse is, essentially, democratize the game building.”

That’s why investing in games technology and tools is a smart move. What about owning? StarCraft And Crash Bandicoot come into it? Asked what he expected people to be doing beyond gaming “inside this intellectual property that Microsoft is paying so much for,” Nadella pointed to the social and cultural dimensions of Forza Horizon 5 — a game that’s nominally just about racing cars.

“Think about how we’re able to tell even the story of car racing through a cultural lens,” Nadella said. “This entire new game that we produced is all about Mexico, and the Mexican setting and car racing […] You think ‘my avatar in Forza is my car’ and how I decorate it.

“To me, just being great at game building gives us the permission to build this next platform, which is essentially the next internet: the embodied presence. Today, I play a game, but I’m not in the game. Let’s start dreaming! [that]These metaverses allow me to be literally in the game just as you can be with me in a conference. This metaphor is the technology […] will manifest itself in different contexts.”

The interview also touched on the regulatory scrutiny Microsoft’s acquisition of Activision Blizzard will face. Nadella dismissed concerns that it might be blocked on monopolistic grounds, noting that it would make Microsoft only the world’s third-biggest gaming company by revenue, behind Tencent and Sony.

“At the end of the day, all the analysis here has to be done through a lens of what’s the category we’re talking about, and what about the market structure? With a low number of teens, we’ll still rank third after the acquisition. [market]shares, where the best player cannot be present [in the] teens [for market] share. It shows the diversity of platforms for creating content. And so, that’s the fundamental category. Yes, we will be a big player in what is a highly fragmented place.”