Microsoft announced the acquisition of the famous game producer Activision Blizzard for $68.7 billion, which caused a sensation in the entire game circle. And Microsoft's main competitor in the gaming world, Sony, is particularly "injured."
A comprehensive Bloomberg and the Financial Times reported on Jan. 19 that Sony's stock market decline in Tokyo widened to 13 percent, its biggest drop since October 2008. The blow reduced Sony's valuation by about $20 billion (about 126.9 billion yuan).
After the launch of a new generation of game consoles, it is widely believed that Sony's PS5 is better than the Xbox Series X in the market. But this acquisition has made the prospects of this generation of console wars confusing. Reuters sharply compared in an analytical article: "In this 'gunfight' of this global game, Sony only carried a knife. ”
Reuters: In the "gunfight" of this global game, Sony only brought a knife
On January 18, Sony closed the Japanese stock market at 14,230 yen per share (about 789 yuan). Affected by Microsoft's acquisition of Activision Blizzard, the opening of the 19th immediately fell to 12900 yen / share (about 715 yuan), and then the stock price rose, but continued to fall in the afternoon, and finally closed at 12410 yen / share (about 688 yuan).
According to the Financial Times, Microsoft's announcement of the acquisition was a "blow" to Sony, reducing Sony's valuation by $20 billion and ending a new high in stock prices since 2022. Sony's total valuation is about $140 billion. Microsoft's total valuation is $2.33 trillion, nearly 20 times the former.
Sony's stock price plummeted
In addition, Microsoft's move has also caused a shock to the stock price of the entire game industry. From the perspective of the parties to the acquisition, Activision Blizzard's stock price soared 25.88% to 82.31 US dollars per share, an intraday rise of more than 32%. Microsoft shares closed down 2.43 percent at $302.65 a share on Tuesday.
The market speculated that Sony would also follow Microsoft's lead in acquiring two Japanese game companies, Square Enix and Capcom. As a result, the stock prices of these two companies rose on the 19th, exceeding 3.5%.
At the same time, two Japanese game companies, Nintendo and Konami, were also affected by the knock-on effect, with their stock prices up 2.51% and 3.25%, respectively.
Some of Sony's long-time shareholders told the Financial Times that the share price will be "punished" because of the "subconscious" fear that Sony will be pressured by Microsoft to acquire a high-premium target, or competitively acquire Activision Blizzard.
On the other hand, the possibility that Activision Blizzard's games will not log on to the PS platform is also the reason for the decline in Sony's stock price.
But overall, Microsoft's acquisition has made the prospect of this generation of console wars confusing. In November 2020, the PS5 and Xbox Series X were launched, leading the current generation of console wars. Market analysts believe that thanks to strong first-party game production capabilities, PS5 has taken the lead in this big battle.
Xbox and PS console logo Infographic
But as soon as Microsoft announced the acquisition, it led to speculation that the balance may begin to tilt in Microsoft's favor. The main reason is that Activision Blizzard has a considerable number of well-known game IPs. For example, Activision owns call of duty, a blockbuster game that sells millions or even tens of millions of copies a year.
As an established game production company, Blizzard has IPs such as Overwatch, Diablo, World of Warcraft and StarCraft.
Blizzard's Overwatch
David Gibson, an analyst at MST Financial, a specialist financial markets analyst firm, said: "The market is speculating about the fate of Call of Duty. If Microsoft wants to make the game exclusive on its own console, that looks like financial suicide, but it could also make them stronger. ”
Other analysts believe that Microsoft may not take such an extreme approach, but will add to its advantage by letting Call of Duty produce exclusive content on its own platform. For example, analysts at investment bank Macquarie Group believe that Call of Duty has sold well on Sony's gaming platform. Microsoft may not be able to cut off the game's sales on the PS platform, but will attract PS players by adding exclusive content.
Recently, Microsoft's acquisitions in the gaming world have been frequent. Just a year ago, Microsoft bought another influential game company, Bethesda, for $7.5 billion. The acquisition of Activision Blizzard will make Microsoft the third largest company in the world in terms of revenue, after Tencent in China and Sony in Japan.
The BBC believes this marks a major shift in the gaming industry.
Reuters sharply wrote in the headline of an analytical article: "In this 'gunfight' of this global game, Sony found itself carrying only a knife. ”
"The battle between Sony and Microsoft is like David and Goliath, but Microsoft looks like a completely different level of rivalry." Commented on in the article.
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