Sony shares fell 13% following news of Xbox’s Activision Blizzard deal
Drop wipes $20 billion off the PlayStation firm’s market valuation
This story was updated on Jan 19 at 1pm GMT.
Sony shares fell by nearly 13% on Wednesday following the news that Microsoft plans to acquire Activision Blizzard.
The movement represents Sony’s biggest drop since October 2008 and effectively wipes $20 billion from its market valuation in a single day.
In comparison, third-party publishers including Capcom, Square Enix, Electric Arts and Ubisoft all saw their share prices surge following the announcement of the deal.
The Xbox maker announced before the market opened today that it intends to buy the Call of Duty and World of Warcraft publisher in a $68.7 billion deal – the game industry’s biggest ever by some distance.
Microsoft reportedly plans to keep making “some” Activision Blizzard games for PlayStation consoles following the takeover’s expected completion in 2023, and Xbox head Phil Spencer has claimed that “it’s not our intent to pull communities away from that platform”.
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It’s worth noting however that Spencer made similar comments prior the completion of Microsoft’s $7.5 billion takeover of Bethesda parent company Zenimax.
While previously released Bethesda games such as The Elder Scrolls Online continue to be supported on PlayStation platforms, and pre-existing exclusivity deals for Deathloop and Ghostwire Tokyo have been honoured, Microsoft has since confirmed that the company’s big future games such as Starfield, Redfall and The Elder Scrolls 6 will be exclusive to Xbox and PC.
“Long-term this shows Microsoft is operating at an entirely different level than Sony and Nintendo,” DFC Intelligence said of the Activision Blizzard deal in a research note.
“Sony and Nintendo have huge presence in the existing game business, but those two smaller Japanese companies struggle to play in the higher strategic space the industry is heading.
“This is more about Microsoft competing with Google, Amazon, Apple, Facebook and others. This acquisition would immediately put Microsoft in a solid strategic position.”