Microsoft's Nadella says Activision buy pushes it further into the metaverse
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Microsoft's (NASDAQ:MSFT) pending acquisition of Activision (NASDAQ:ATVI) will help the company further expand into the metaverse, even if what the metaverse is has not been fully fleshed out yet, Chief Executive Satya Nadella said in an interview.
Speaking with the Financial Times in his first interview since the announcement, Nadella, 54, said that the metaverse is "essentially about creating games," one task that Microsoft has done for decades, going all the way back to "Flight Simulator."
"Metaverse is essentially about creating games," Nadella said in the interview. "It is about being able to put people, places, things [in] a physics engine and then having all the people, places, things in the physics engine relate to each other."
"You and I will be sitting on a conference room table soon with either our avatars or our holograms or even 2D surfaces with surround audio. Guess what? The place where we have been doing that forever . . . is gaming."
"And so, the way we will even approach the system side of what weâre going to build for the metaverse is, essentially, democratize the game building . . . and bring it to anybody who wants to build any space and have essentially, people, places, [and] things digitized and relating to each other with their body presence."
Last month, Microsoft announced that it was buying Activision, known for its popular "Call of Duty" and "Warcraft" franchises, for approximately $69 billion, pushing the company further into gaming.
Should the deal close, it would make Microsoft the third-largest gaming company by revenue, behind only Tencent (OTCPK:TCEHY) and Sony (NYSE:SONY).
Nadella expanded on the intersection between gaming and metaverse, noting that the demographic of those who play video games is getting younger every year and they have expectations about how to interact, with many wanting to use avatars, especially as they approach working age.
"[They would say] Oh yeah, I want to use an avatar, because having . . . multiple identities for different contexts is a much more expected thing if youâre going from gaming world to a gaming world," Nadella added. "Being mindful of that as we introduce new tools and new features in what may be considered more work-related products . . . is absolutely something we want to learn."
On Tuesday, it was reported that the U.S. Federal Trade Commission would review Microsoft's (MSFT) pending acquisition of Activision and not the Department of Justice, as is custom.