Microsoft to Acquire Activision-Blizzard Amidst Ongoing Workplace Culture Scandal [UPDATE]

The deal was to the tune of nearly $70 billion.

In the midst of Activision-Blizzard’s ongoing legal trouble following a California lawsuit for harassment and discrimination in its workplace culture, Microsoft is buying the Call of Duty publisher for $68.7 billion.

The acquisition news comes from a post on the Xbox Wire, where Head of Xbox Phil Spencer said that, until the deal closes, Activision-Blizzard and Microsoft will operate independently. This means the company is free to continue its union-busting, strike-ignoring ways as the lawsuit and ongoing harassment investigations unfold until every “i” is dotted and “t” is crossed. Though Spencer says that changing company culture is part of the acquisition.

“As a company, Microsoft is committed to our journey for inclusion in every aspect of gaming, among both employees and players,” Spencer wrote. “We deeply value individual studio cultures. We also believe that creative success and autonomy go hand-in-hand with treating every person with dignity and respect. We hold all teams, and all leaders, to this commitment. We’re looking forward to extending our culture of proactive inclusion to the great teams across Activision Blizzard.”

The post says the deal will bring Activision games to Game Pass on Xbox and PC, as well as help to accelerate the company’s Cloud Gaming service. What this means for the company’s game exclusivity is unclear. It seems unbelievable that something like Call of Duty could become a Microsoft exclusive, as even after Xbox’s acquisition of Mojang, Minecraft and its spin-offs still came to other platforms. But after buying Bethesda, Spencer’s messaging about that studio’s previously-multiplatform games has leaned more toward exclusivity.

More about Activision-Blizzard:

It’s impossible to remove the state of Activision-Blizzard from the timing of this acquisition, but if we push that hulking boulder away with all our might, this is another acquisition from Microsoft that is swallowing a megalithic company like an unstoppable, gaping maw, fundamentally changing the landscape for some of the biggest companies and properties in the industry. It will inevitably get weaponized by Xbox zealots online as proof that their video game box is better than others, but for the sane ones in the room, this feels like a company making another huge step in consolidating the market. And Microsoft’s done it enough lately to call it a pattern. If nothing else, I hope Microsoft can steer the company’s culture in the right direction, but the scale of these company acquisitions are starting to sound like forum wish-fulfillment speculation turned real. And that’s got bigger ramifications than whether or not your video game box is cooler than some stranger’s on the internet.

Update: In a statement sent to Axios, Microsoft has confirmed Activision-Blizzard CEO Bobby Kotick will stay on as CEO, but doesn’t clarify if that will be the case after the deal closes, saying the business will report to Phil [Spencer] after.

As for whether or not Activision-Blizzard games will become Xbox and Windows exclusive, a Microsoft representative told Axios the deal is “about increasing the availability” of the company’s games, which it says is “consistent” with the company’s MO, but its messaging hasn’t been consistent.

“[AB]’s games exist on a variety of platforms today, and we plan to continue supporting those communities moving forward. The acquisition is about increasing the availability of Activision Blizzard content across more platforms, including mobile. This is consistent with Microsoft’s commitment to giving players more choice to play the games they want, anywhere.”

Update: Karen Weise of the New York Times posted on Twitter that the outlet had spoken with Kotick, and he declined to say outright whether or not he will remain as CEO following Microsoft’s acquisition. He says “post close [he] will be available as needed.” This is vague enough to mean nothing specific, but the lack of a definitive “yes” or “no” answer about whether Kotick will remain CEO after the acquisition is worth noting as the story develops.

Update: While Microsoft and Activision’s messaging on the matter has been vague and noncommittal, Wall Street Journal reports sources close to the matter that Kotick will be stepping down as CEO after Microsoft’s acquisition is finalized.

[via WSJ]

Bobby Kotick, Activision’s longtime CEO, is expected to leave after the deal closes, according to people familiar with those plans. Microsoft had said in its announcement Tuesday that Mr. Kotick “will continue to serve as CEO of Activision Blizzard,” and that after the deal closes “the Activision Blizzard business will report to Microsoft gaming chief Phil Spencer. ” But the companies have agreed that he will depart once the deal closes, the people said.