Console wars: Sony shares plunged after Microsoft’s announcement to acquire Activision Blizzard

About 30% of Sony's revenue comes from video games.

About 30% of Sony’s revenue comes from video games.

Photo: ED JONES/AFP/Getty Images

Shares in the maker of the PlayStation console, one of the main rivals of Microsoft’s Xbox, plummeted almost 13% in Tokyo this Wednesday after Microsoft announced that it would buy video game powerhouse Activision Blizzard for nearly $70 billion.

It was the worst drop in Sony’s share price since 2008, according to data provider Refinitiv.

Microsoft and Sony have competed for decades with iterations of their consoles Xbox Y PlayStation, often courting gamers with exclusive titles and features.

Microsoft already owns successful franchises like “Halo,” but the deal with Activision Blizzard will add popular series like “Call of Duty” and “World of Warcraft” to its library, as well as the nearly 400 million monthly active players that go with them.

The acquisition of Activision will make Microsoft the third largest video game company in the world by revenue, behind Tencent and Sony.

Near to 30% of Sony’s revenue comes from video games and network services, according to the company’s latest earnings report.

Investors are concerned that Sony will lose out to Microsoft in gaming content, especially if some of Activision’s titles become exclusive to Microsoft systems.

Although the PlayStation 5 console is considered more popular than the Xbox Series X, Sony has fallen behind in launching a true competitor to Microsoft’s Game Pass cloud subscription service, which allows you to play a selection of games for a fee. monthly.

Since November 2020, Sony has been struggling to supply the PlayStation 5 (PS5) consoles, which have had “unprecedented” demand, said by the same company.

Microsoft reported that it has over 25 million Game Pass subscribers and that it will “offer as many Activision Blizzard games as it can” on the Xbox and PC versions of the service.

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