Microsoft just spent $7.5 billion to give gamers a major reason to buy a next-gen Xbox instead of a PlayStation 5
- In a Monday morning surprise,
Microsoftrevealed plans to spend $7.5 billion on the acquisition of ZeniMax Media— the parent company of game publisher Bethesda Softworks, which makes "Fallout," "DOOM," and "The Elder Scrolls," among many other games.
- The deal is the latest in a string of Microsoft
gamingacquisitions intended to bolster the Xboxgaming portfolio, and will bring major franchises in-house to Xbox Studios.
- With both Microsoft's next-gen Xbox and Sony's next-gen PlayStation launching this November, the acquisition has major implications for the next several years.
- The next major entries in franchises like "The Elder Scrolls" and "Fallout" are likely to be exclusive to Microsoft's Xbox and PC platforms, leaving the PlayStation 5 out.
Just days after Sony announced pricing for the PlayStation 5, Microsoft revealed a huge surprise on Monday morning: The acquisition of the massive game publisher behind franchises like "Fallout," "The Elder Scrolls," and "Doom" in a deal worth $7.5 billion in cash.
The deal for the conglomerate
The acquisition by Microsoft is likely to change that for good.In an email exchange with Business Insider, Wedbush managing director Michael Pachter said it was "unlikely" that Microsoft will publish the forthcoming entries to major franchises on Sony's PlayStation 5 or Nintendo's Switch "after 2021." For the time being, Bethesda is likely to have contractual obligations to Sony for upcoming games that are already in production.
One such game, "Deathloop," is a so-called "timed exclusive" on Sony's PlayStation 5 — meaning it wouldn't come to Microsoft's
Microsoft has been on a spending spree
With the exception of the "Minecraft" franchise, which Microsoft acquired for $2.5 billion in September 2014, the studios that Microsoft has purchased in the last several years are dedicated to creating games for the Xbox and PC platforms.
Sony's PlayStation 4 boasts a vast portfolio of critically and commercially successful games — including "God of War," "Marvel's Spider-Man," "The Last of Us: Part II," and "Bloodborne" — that can only be played on the PlayStation 4. Microsoft's Xbox One, on the other hand, only has a handful of such games ("Gears 5," "Sea of Thieves," and "Halo: The Master Chief Collection"), and they can all still be played on PC if you'd prefer.
The rise of Game Pass
Instead, Microsoft has gone a different route.Its focus is on a new service named Xbox Game Pass, which offers a Netflix-like library of games that can be downloaded to your Xbox/PC or played remotely via the cloud on Android smartphones. Game Pass charges a monthly subscription that starts at $10, and includes all of Microsoft's first-party games at launch.
It's this service in particular that Microsoft intends to bolster with the purchase of Bethesda Softworks."We will be adding Bethesda's iconic franchises to Xbox Game Pass for console and PC," Spencer said in the acquisition announcement post. Moreover, those games will arrive on the Game Pass service on the same day they launch otherwise for the next-gen Xbox consoles and PC — games like the highly-anticipated "The Elder Scrolls VI," and "Starfield," and whatever's next in the "Fallout" franchise.
And they probably won't arrive on the PlayStation 5.Got a tip? Contact Business Insider senior correspondent Ben Gilbert via email (firstname.lastname@example.org), or Twitter DM (@realbengilbert). We can keep sources anonymous. Use a non-work device to reach out. PR pitches by email only, please.
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