Will Microsoft’s Activision deal open the metaverse up to enterprise tech?

Among the gaming brands Microsoft will acquire in the Activision Blizzard deal - Source: Microsoft
Jan 19, 2022

Microsoft yesterday said that it has reached a deal to acquire Activision Blizzard for $68.7 billion in cash. The acquisition, should it receive regulatory approval, will make Microsoft the third-largest video gaming company in the world. It may also give Microsoft the tools it needs to become a driving force in moving enterprise technology into the metaverse.

Satya Nadella, Microsoft CEO, said on a conference call yesterday that the combination of its existing gaming business and Activision Blizzard’s will help the company remove “barriers” and bring together “digital and physical worlds” as metaverse platforms are developed.

Mr. Nadella focused most of his metaverse comments on gaming but made clear that the opportunity was not confined to that space.

“We need to support many metaverse platforms, as well as a robust ecosystem of content, commerce and applications,” he said.

A Wall Street Journal article points out that a significant portion of the technology used to create the metaverse comes from the gaming industry. Being able to bring that expertise into the enterprise technology space could be huge for Microsoft and its legion of business customers.

The same article points to metaverse applications that would enable companies to conduct “remote job interviews in virtual settings, internal training simulations, 3-D demos, digital malls and events to promote products and services — all interacting with customers’ videogame-like avatars.”

Retailers and brands are taking their first steps into the metaverse, with recent reports of Nike, Ralph Lauren and Walmart engaging in early efforts to understand and eventually monetize the opportunities coming down the pike.

Microsoft will have a lot of competition in the space. Facebook announced a corporate name change last year to Meta in a clear indication of where the social media giant sees its future prospects.

The company demonstrated examples of avatars being used by people to play games, socialize, shop and work with others from remote locations.

Much metaverse technology is still in its infancy stage, but tech leaders, including Meta CEO Mark Zuckerberg, promise future platforms “will be even more immersive and embodied internet where you’re in the experience, not just looking at it. We believe the metaverse will be the successor to the mobile internet.”

DISCUSSION QUESTIONS: Do you see Microsoft’s deal to acquire Activision Blizzard as having significant implications for its enterprise technology business? Where do you expect retailers to make the most use of metaverse platforms over the next decade?

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"The deal to acquire Activision Blizzard seems to fit well into Microsoft’s growth prospects, including enterprise technology."

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8 Comments on "Will Microsoft’s Activision deal open the metaverse up to enterprise tech?"

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Jennifer Bartashus

As more people explore metaverse platforms, an entire spectrum of new opportunities is emerging, all of which will be reliant on rapidly evolving technology. The metaverse – which could be argued will be the next generation of gaming – may be powered by the cloud. The deal to acquire Activision Blizzard seems to fit well into Microsoft’s growth prospects, including enterprise technology.

Jeff Weidauer

Video games have become much more than a form of entertainment. The industry is the driving force in the creation of new content and advanced technology, while expanding what we expect from virtual engagement.

Gene Detroyer

I wish I understood the metaverse. Maybe I am just too old?

Richard Hernandez
Richard Hernandez
Director of Commerce
8 months 13 days ago

I can definitely see a confluence between social media and gaming and extending into the business sector. The metaverse is taking shape quickly, and it is wise for Microsoft to be proactive knowing it will have to be competitive with the Facebooks of the world which have already begun to shape the infrastructure for the metaverse.

Brandon Rael

By acquiring Activision Blizzard, the Microsoft team is making a long-term strategic play into the commercial potential of the metaverse. The metaverse is scaling, evolving, and pivoting rapidly, and larger companies such as Microsoft are positioning themselves for the long game.

We live in a fragmented world, where we are balancing our time between physical and digital experiences. The winners in the metaverse space will drive experiences for Gen Z and all other generations that span across both physical and digital platforms. At this point, the smartphone remains the most dominant “key to the metaverse.” The smartphone form factor is perfect for the modern consumer that enjoys shopping in a physical store with digitally connected elements.

Kenneth Leung

The Activision deal in the short term is about the gaming business and a smart acquisition by Microsoft of a company facing leadership problems. I am not sure metaverse and enterprise technology is any closer than the last time around when Second Life was introduced and Occulus and the drive to immersive content. I am thinking what really changed in terms of use cases for metaverse? Pandemic drove a lot of remote work, but replacing hours of zoom meetings on camera and screen with metaverse meetings isn’t the answer….

Ashley Crowder
8 months 12 days ago

This holiday was the first year Meta’s Oculus VR headset outsold Microsoft’s XBox, smart move on Microsoft to acquire Activision so they don’t fall behind in the race to build the Metaverse. We’re already seeing fashion companies monetize digital assets — Balenziaga sold digital-only designs in Fortnite, Gucci sold a $4k purse in Roblox — this is just the beginning for digital fashion and it’s great to see big platforms investing in its future.

Anil Patel

Yes. Microsoft will create a significant impact on the enterprise technology business. Microsoft previously acquired many organizations like LinkedIn which later turned out to be the best in what they do. Microsoft grilled those brands, aligned them with the community while retaining their original nature and actual missions. I expect Microsoft to contribute in the same way.

Retailers will use metaverse mostly to give an edge to their strategies and provide differentiation to their products. Since metaverse won’t be much different than the real world, retailers will have a chance to create a product presence and innovate more so that the brand value is enhanced to a large extent.

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