Microsoft in the Gaming Community

Just two days ago, there was a huge ripple in the gaming community as Microsoft announced the acquisition of Mojang, a Swedish game developer, for $2.5 billion. Mojang is best known for its creation of Minecraft, one of the most popular free-to-play sandbox games that allows players to construct the world as they see fit: it combines simple controls and retro graphics with a revolutionary degree of freedom and creativity. So, why is this such a big deal?

For Microsoft, this acquisition allows it to directly break into one of the most saturated gaming communities currently existing. Minecraft alone is one of the best top selling apps on both the Apple store and Google Play, and according to NPD Group, it is the third most popular console game, as of last month. Not only will this buy potentially boost sales for Microsoft consoles, such as Xbox One, but it will also, more importantly, help Microsoft’ smartphone segment recover from declining sales. Although Windows Phone sales have been rising over the last year, sales have plummeted 9.4% in Q2 2014 compared to the same period last year, according to IDC. With access to more than 100 million registered users from over 54 million downloads, Minecraft can become a vital tool for Microsoft to leverage to augment the attractiveness of its handsets. Because Minecraft’s customer base are mainly young adults, Microsoft has the opportunity to heavily influence the next generation of consumers in the mobile market as it could really differentiate its phones by making the presence of Minecraft an exclusive feature to its devices (or even mobile software platform).

In my opinion, I feel that this acquisition is a very smart move for Microsoft’s next stage of expansion. Not only will it be able to leverage the popularity of Minecraft to boost sales in its faltering handset business, but Microsoft will also have the opportunity to give more exposure to its other products either directly through the game, or any mediums carrying the game. By buying up a generation of young user base, Microsoft is positioning itself in a favorable situation, in which it carries a lot of power to influence where the electronic market is heading next.

-Yue Song