The landscape of the video game industry radically changed today.Microsoft announced it is acquiring Activision Blizzard for $68.7 billion, far outpacing its $7.5 billion acquisition of ZeniMax Media completed in March 2021. Questions about this corporate consolidation have been raised considering the Xbox Game Studios umbrella now includes multiple leading first-person shooters (Halo,Call of Duty, andDoom); one of the world’s biggest MMORPGs (World of Warcraft); and major western RPGs (The Elder Scrolls,Fallout, andThe Outer Worlds).
Many have been discussing the acquisition deal because it means Microsoft will inevitably take point on the fallout of Activision Blizzard’s recent controversies and ongoing workers strike. It seems addingproperties like original PlayStation-exclusivesSpyro the DragonandCrash Bandicootinto the Xbox family is worth that trouble for Microsoft, but some may be overlooking the benefits of having mobile studio King Digital Entertainment under its purview. Between Microsoft’s acquisition and Take-Two Interactive buying Zynga for $12.7 billion earlier this month, it seems AAA developers could lean into the mobile space more than ever.
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Zynga and King’s Influence in the Mobile Space
Take-Two’s acquisition of Zynga, announced on January 10, was a huge move that marked something of a transition for the publisher. Zynga rose to fame on the back of Facebook games likeFarmVille, and then became a largely mobile-focused developer. Some of its biggest franchises beyondFarmVilleincludeZynga PokerandWords With Friends, but the studio has also worked on licensed properties includingGame of Thrones: Slots CasinoandHarry Potter: Puzzle & Spells. This reach may extend to the Take-Two library, as CEOStrauss Zelnick has discussed bringingBioShock,GTA, and more to mobile.
King has just as much, if not more name recognition than Zynga thanks to its flagship property,Candy Crush Saga. The casual match-three puzzle game is a juggernaut that has spawned numerous spin-offs and similar ventures such asBubble Witch SagaandBlossom Blast Saga. Activision Blizzard acquired King in February 2016 for nearly $6 billion, and while the studio’s flagshipCall of Duty Mobilehas been handled by Tencent subsidiary TiMi Studios, King has also begun working on licensed properties. Themobile spin-offCrash Bandicoot: On the Run!released in March 2021, following on the franchise’s revival inCrash Bandicoot 4: It’s About Time.
Wider Mobile Trends in the Video Game Industry
The success of these two recently acquired studios are not isolated cases. A Statista report from November 2021 found smartphone games accounted for almost 50 percent of all video game revenue worldwide in 2020, with that slice of the industry expected to surpass $100 billion in revenue by 2030. Eight mobile games surpassed $1 billion dollars in player spending globally last year, according to mobile market analyst Sensor Tower:PUBG Mobile,Honor of Kings,Genshin Impact,Roblox,Coin Master,Pokemon GO,Candy Crush Saga, andGarena Free Fire.
While TiMi Studios' MOBAHonor of Kingsreceived $2.8 billion last year despite only being available in China,Genshin Impactis an interesting case of a Chinese game breaking out worldwide. Developed by miHoYo,Genshin Impactwas viewed as aLegend of Zelda: Breath of the Wildclone upon its initial announcement due to their similar art direction and mechanics. YetGenshinbecame a phenomenon of a gacha game, partially thanks to the entire experience being available on mobile as well as PC and PlayStation. After being downloaded more than 17 million times on mobile in its first four days,Genshin Impactbecame the fastest mobile game to make $1 billionlast year, beating out Niantic’sPokemon GOby at least three months.
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Niantic’s ongoing success withPokemon GOsince summer 2016 is more evidence of the industry moving toward mobile development. Though it is one of the biggest players out of Japan, Nintendo was slow to move into the mobile space on account of its work developing handheld consoles from the Game Boy to the 3DS. The AR game based on Game Freak’sPokemonfranchise opened the door for more to follow, including anotherNiantic game calledPikmin Bloom;Intelligent Systems’Fire Emblem Heroes;DeNA’sPokemon Masters EX; and in-house Nintendo games likeSuper Mario Run,Mario Kart Tour, andAnimal Crossing: Pocket Camp. Plenty more iconic gaming franchises have dipped their toes in mobile with titles likeYu-Gi-Oh! Duel LinksandTeppen, based on Capcom properties.
AAA Mobile Games May Be the Future for Take-Two, Xbox
While it’s unlikely the traditional PC and console game market will disappear anytime soon, there are plenty of incentives for companies like Take-Two Interactive and Xbox to broach the mobile scene with their biggest franchises. The PlayStation 5 and Xbox Series X are powerful pieces of hardware, but alsonotoriously difficult to get due to ongoing part shortages. Almost everyone has a smartphone in their pocket at all times, and titles likeGenshin Impactshow there are fewer limitations for developers than in the age ofAngry BirdsandCut the Rope.
With Zynga and King, respectively, Take-Two andXboxhave more inroads to dedicated mobile games for some of their biggest series. Today’s acquisition announcement may be dominated by conversations surrounding games likeCall of DutyorWorld of Warcraft, but given how huge the mobile space has become, it’s worth keeping that potential in mind. The industry will no doubt continue to evolve, and hopefully the workers pushing those boundaries see better treatment along the way.
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