Microsoft’s acquisition of Activision Blizzard, will it get involved in NFTs like other game manufacturers?


January 24, 2022

Tech giant Microsoft dropped a bombshell on the video game and metaverse industry yesterday.

The company announced that it will acquire one of the world’s largest video game companies, Activision Blizzard, which owns Call of Duty, World of Warcraft, and Overwatch, in an all-cash deal valued at approximately $75 billion. Pioneer and other popular games. The acquisition will accelerate the growth of Microsoft’s gaming business across mobile, PC, consoles, and cloud, and will provide the cornerstone for the Metaverse.

If the deal is completed, it will significantly expand the scale of Microsoft’s game business, and Microsoft will naturally become the third-largest game company in the world by revenue after Tencent and Sony.

The metaverse is a term describing a vision for the future of the internet, a shared virtual world where users can interact through avatars, promising a more immersive new way of socializing, entertaining, and working online. Users can cross interoperable platforms, and blockchain technology and crypto assets (including NFTs) will play an important role.

Ethereum blockchain-based virtual world games like Decentraland and The Sandbox are seen as early examples of the metaverse, allowing users to buy, customize and trade virtual land in the form of NFTs. Facebook has also expressed great interest in the Metaverse, renaming its parent company Meta last October, making the Metaverse an important business for the company’s next phase.

Bloomberg had predicted that the Metaverse could be worth $800 billion by 2024 if current fiery trends remain.

While Activision Blizzard has yet to act in the metaverse or NFTs, blockchain gaming, Microsoft has been involved in the crypto industry for years.

As early as 2015, Microsoft announced a partnership with ConsenSys, an Ethereum software technology company. Also, so far, the software and tech giant appears to be “favoring” the NFT space.

In February last year, Microsoft launched a small experiment around NFTs, and cooperated with the blockchain game development platform Enjin to launch a limited NFT commemorating “International Women in Science Day”. Users only need to complete a game called “Azure Space Mystery”. Web games can be obtained. These NFTs have additional functionality: by logging into the MyMetaverse server in the Minecraft game and connecting to the Enjin wallet, users can complete follow-up missions in Minecraft to unlock more collectibles such as “XX & XY” Certified Equal," a “tokenized credential that encourages chromosomal and all gender equality.”

In December, Microsoft’s M12 Venture Fund led the investment in Palm NFT Studio, a brand-customized, NFT-centric Ethereum sidechain that focuses on “energy-saving”. “Microsoft is starting to look beyond private blockchain implementations and into a wider range of use cases,” Dan Heyman, the project’s CEO, said in an interview. And Palm’s eco-friendly design – trading energy used An estimated 99% less than the Ethereum main net, another reason to attract Microsoft.

Also noteworthy is Microsoft’s launch of the ION Network, a decentralized identity (DID) network built on top of the Bitcoin blockchain. ION does not process payments but is designed to handle identity and access to online accounts. The network took four years to develop, with contributors including ConsenSys, Casa, BitPay, Gemini, Protocol Labs (IPFS), and Cloudflare familiar to crypto users.

A week after Facebook’s rebranding last year, Microsoft also announced its entry into the “new battlefield” of the Metaverse.

Microsoft unveiled its vision for augmented and virtual reality (AR/VR) meetings in Mesh for Teams at its Ignite developer event in November, combining AR/VR capabilities with online meeting tools to make remote meetings more immersive territory. Companies/organizations can build virtual spaces where users can join meetings with their custom avatars (still pictures, videos, etc.) as avatars.

Katie Kelly, principal program manager for Microsoft Mesh for Teams, explained in a statement: “First, we’ll get audio cues so that when you speak, your face comes to life. …your hand will move….you will experience a sense of immersion….our goal is to keep an eye on this using Microsoft’s artificial intelligence technology so we can use the camera to hint at you where your mouth is and mimic your head and facial movements.”

VR and AR are expected to play an important role in the future metaverse. Although Microsoft has not yet adopted VR, its HoloLens, a holographic device developed by it, is very impressive. The MR technology (Mixed Reality) it uses can learn from the environment and can realize the fusion of holographic images and the real environment.

Microsoft’s current CEO, Satya Nadella, said at its annual meeting in November 2021 that virtual reality goggles and gloves will be released in 2022. In addition, Microsoft will launch nearly 100 new services in 3 areas, including the Metaverse.

“As the digital and physical worlds converge, we are creating a whole new platform layer, the metaverse. In a sense, the metaverse enables us to embed computing into the real world and embed the real world into computing, thereby bringing real presence to any digital space."

Additionally, Nadella said that people “absolutely expect” to see Microsoft integrate Metaverse features with the Xbox console, but didn’t reveal any specific plans or specifics.

Back to the topic, “Acquisition of Activision Blizzard Accelerates Growth of Microsoft Gaming and Will Provide Cornerstone for the Metaverse”.

As part of the acquisition, Activision Blizzard CEO Bobby Kotick will remain at the helm until the deal closes, before handing it over to Microsoft Gaming CEO Phil Spencer. Spencer welcomed the addition of Activision Blizzard via a blog post for the Xbox console and will work hard to add as many Activision Blizzard hits to Xbox as possible. But nothing is said about the Metaverse and NFTs, and it seems that these areas have been strongly opposed by some players in the gaming community.

Recently, some traditional video game manufacturers have been eager to NFT and NFT-driven blockchain games, but their actions have not been smooth.

Square Enix, the developer behind Final Fantasy, has announced the development of NFT-centric games, and Electronic Arts (EA) has also expressed interest in the NFT space.

Last week, Take-Two Interactive, the parent company behind Grand Theft Auto, bought mobile game maker Zynga for $12.7 billion. Zynga will start developing NFT-based games in late 2021, and Take-Two CEO Strauss Zelnick said of the acquisition that he believes the combined company will be better positioned to address the “Web3 opportunity.”

Behavior, the developer of “Dead by Daylight”, launched the game character NFT, but it was criticized by players because “NFT consumes energy, is a scam, and has no value”. As an objection, players united to publish the game in the Steam game store " Negative review", forcing Behavior to issue a compromising statement: “We understand your concerns about NFTs, there is absolutely no blockchain technology in Dead by Daylight and never will be. We will never sell NFTs.”

Another example is Stalker 2: Heart of Chernobyl, the developer behind it, GSC Game World, announced that it would add NFT characters to the game and sell it as development funding for the sequel. However, the company scrapped its NFT program after negative criticism from gamers.

Ubisoft, the developer behind “Assassin’s Creed”, launched NFT-centric game items in December last year, and it also repeatedly mentioned the energy consumed by a single transaction on the Tezos blockchain based on its release. “1 million times less” than Bitcoin, thus proving that its NFTs are “energy-efficient”. However, this move has also caused Ubisoft to be criticized.

It is unclear whether Microsoft’s Metaverse will introduce NFTs, and whether the acquisition of Activision Blizzard will make some moves in the field of NFTs that the encryption industry “favors”. However, judging from Microsoft’s lead investment in Palm NFT Studio, under the prosperity and external expansion of NFT, how to minimize the impact of Ethereum and NFT on the environment is also a top priority.