Shortly after reports that Discord was investigating a sale, a new report says that Microsoft has emerged as a front-runner in the discussions.
Microsoft is a natural candidate for a purchase of Discord, given the company’s focus on gaming. In addition to its Xbox platform, Microsoft recently bought ZeniMax Media, and its gaming studio Bethesda Softworks, in an effort to bring more game development in-house.
As Bloomberg highlights, Microsoft has been shopping for companies that could help it establish, grow and interact with a community of users. The company recently tried to purchase TikTok and was in talks to acquire Pinterest. Services such as this are seen as especially valuable as a result of the pandemic, as virtual communities can help address people’s need for social interaction in a safe way.
“Microsoft possibly acquiring Discord makes a lot of sense as it continues to reshape its gaming business more toward software and services,” said Bloomberg Intelligence Analyst Matthew Kanterman. “There’s a big opportunity to bundle Discord’s premium offering, Nitro, into the Game Pass service to drive more subscriptions from the last reported 18 million.”
The report indicates the sale could be north of $10 billion, but nothing is final.
Microsoft on Monday announced plans to acquire ZeniMax Media, the parent company of Bethesda Softworks, one of the largest, privately-held game developers and publishers in the world. The ZeniMax library includes game franchises such as The Elder Scrolls, Fallout, Doom, and Rage, among many others, Under the terms of the agreement, Microsoft will acquire ZeniMax Media for $7.5 billion in cash.
“Gaming is the most expansive category in the entertainment industry, as people everywhere turn to gaming to connect, socialize and play with their friends,” said Satya Nadella, CEO, Microsoft. “Quality differentiated content is the engine behind the growth and value of Xbox Game Pass—from Minecraft to Flight Simulator. As a proven game developer and publisher, Bethesda has seen success across every category of games, and together, we will further our ambition to empower the more than three billion gamers worldwide.”
“This is an awesome time to be an Xbox fan. In the last 10 days alone, we’ve released details on our two new consoles which go on pre-order tomorrow, launched cloud gaming in Xbox Game Pass Ultimate, and now we’re making another investment in the most critical part of our strategy: the games,” said Phil Spencer, executive vice president, Gaming at Microsoft. “Generations of gamers have been captivated by the renowned franchises in the Bethesda portfolio and will continue to be so for years to come as part of Xbox.”
Bethesda parent company ZeniMax Media was founded in 1999 by Chairman and CEO Robert A. Altman; Bethesda’s structure and leadership will remain in place.
“This is a thrilling day for this company, our employees, and our fans. We have enjoyed a close partnership with Microsoft for decades, and this deal is a natural progression of those years working together,” said Altman. “The big winners today are our fans. We are continuing to develop our slate of AAA games, but now with Microsoft’s scale and entire Game Stack, our games can only get better.”
Today is a special day… We are THRILLED to welcome the talented teams and beloved game franchises of @Bethesda to Team Xbox!
Phil Spencer, head of Xbox at Microsoft, discusses the company’s acquisition of game maker ZeniMax and how this impacts gaming and the Xbox platform:
Adding ZeniMax Games To Xbox Is Incredible
Gamers love great games. The Xbox console is going on preorder tomorrow for the next generation. Just last week we added Game Pass cloud streaming so that people can play this Game Pass library across all of their Android phones. Then obviously Game Pass which is the largest game content subscription out there with 15 million subscribers and growing. So getting to work with ZeniMax to bring their amazing collection of games to GamePass is just an incredible opportunity for us.
Our plan is to leave it alone. ZeniMax has an amazing track record of building great games. Our goal is to make ZeniMax the best ZeniMax they can be. ZeniMax will be working individually with their studios on the great platform technology that we have, getting their creators feedback into the things that we need to go build. That’s just a critical flywheel for us innovating, just the feedback from the world’s best creators on our platform.
Committed To Bringing Game Pass To iPhones
When you get large scale general compute platforms like mobile phones people should have access to the great content and services that are out there. We remain committed to that. There are over 3 billion people who play video games today and many of them play on phones. We’re committed to bringing Game Pass to all mobile phones out there including Apple phones. We will continue to have conversations and I’m sure we will be able to get to some resolution.
Our biggest issue (with the Apple app store) isn’t a financial issue. Our biggest issue is that cloud game streaming apps are actually not allowed in the way that Game Pass is built for other platforms. For us, this is about gamers having great access to the content from the creators they love on the devices they own. Play the games that you want with the community that you want to play with the devices that you have. That’s our goal.
COVID Impacted Game Production
People with sheltering in place and work from home, we’ve seen incredible engagement in the gaming community over the last few months. We’re really proud with the way that gaming has been able to play such a pivotal role for people. Games today are hundreds of people coming together to build these massive games. It’s important that we’re conscious of the safety of our teams. COVID has had an impact on production and you’re seeing that out there.
When you look at this launch and people’s appetite for gaming right now we are very bullish on how are preorders are going to go tomorrow. We have the most powerful console on the market. We have the most affordable console on the market. We’ve got things like Xbox All Access that allow people to join this next generation of gaming for $24.99 a month with no upfront costs. You get a console and Game Pass. In times like this, I think that accessibility of price point and offer is really important.
Microsoft has announced it is acquiring ZeniMax Media, the parent company of gaming studio Bethesda Softworks, for $7.5 billion in cash.
Bethesda Softworks is the studio behind The Elder Scrolls, Fallout, Rogue Warrior, Ghostwire: Tokyo and others. Bethesda has established itself as one of the most successful, privately held game studios in the world.
Microsoft’s acquisition will help the company capitalize on the growing gaming market, and fits in well with its current software strategy. While the Microsoft of the past fiercely protected its own platforms, under CEO Satya Nadella the company has emphasized providing the best software experience on all available platforms. This has resulted in more of its software being available on macOS, iOS, Android and Linux, in addition to Windows.
The same is true for gaming. Microsoft is focusing on providing the best gaming experiencing wherever, and on whatever device, a person may be playing. Owning a studio with Bethesda’s track record is a big step toward that goal.
“Gaming is the most expansive category in the entertainment industry, as people everywhere turn to gaming to connect, socialize and play with their friends,” said Satya Nadella, CEO, Microsoft. “Quality differentiated content is the engine behind the growth and value of Xbox Game Pass—from Minecraft to Flight Simulator. As a proven game developer and publisher, Bethesda has seen success across every category of games, and together, we will further our ambition to empower the more than three billion gamers worldwide.”
