Activision Deal is All About Getting Candy Crush According to Phil Spencer

The purchase of Activision Blizzard by the computer giant is more about mobile games like Candy Crush than Call of Duty, according to Microsoft Gaming CEO Phil Spencer, who has emphasized this point once again. During an appearance on The Verge’s Decoder podcast, Spencer said mobile gaming is expanding far more rapidly than console or PC gaming. Additionally, he acknowledged that Xbox is hardly present on mobile. He said, “Anybody who picks up their phone and decides to play a game would see that on their own.”

However, Phil Spencer also said that the $69 billion acquisition of Activision Blizzard was motivated mainly by the need to enter the mobile industry and that the Microsoft Gaming division may very well become unsustainable in the long run if it does not do so.

In terms of the Activision opportunity — I keep saying this over and over, and it is true — it definitely starts with a view that people want to play games on every device that they have. In a funny way, the smallest screen that we play on is actually the biggest screen when you think about the install base in a phone.

That’s just a place where if we don’t gain relevancy as a gaming brand, over time, the business will become untenable. We’re not alone in seeing this; this is true for any of us. If you’re not able to find customers on phones or on any screen that somebody wants to play on, then you really are going to get segmented to a niche part of gaming where running a global business will become very challenging. […] It’s critical that if you’re trying to run an at-scale global gaming business, you meet your customers where they want to play, and mobile is more and more that place.”

In light of this, interviewer Nilay Patel noted that King earns more money than Activision and Blizzard because Candy Crush is even more lucrative than Call of Duty. The CEO of Microsoft Gaming concurred and pointed out that the arrangement primarily focused on Call of Duty on consoles is a Sony creation. 

Absolutely. In addition, the number that’s not in the Candy Crush/King number is Call of Duty: Mobile and Diablo mobile, which are big franchises that exist in that Activision and Blizzard bucket that are also major players on phones. Yes, the idea that Activision is all about Call of Duty on console is a construct that might get created by our console competitor and maybe some players out there.

It’s the same reason that Take-Two looks at Zynga and says, “Okay, we have to build out our mobile capability.” I would say Activision/Blizzard/King did a better job of doing that earlier, and definitely better than we did.” 

The assertion made by Spencer is consistent with what he has previously claimed. He said that mobile was “the biggest gaming platform in the planet” in an interview from August. He said in October that the business intended to handle Call of Duty similarly to Minecraft. According to the company’s declaration with the UK’s Competition and Markets Authority, Microsoft aims to launch an Xbox-branded mobile shop.

While the Activision Blizzard purchase by Microsoft continues to face regulatory scrutiny as it clears final obstacles, probably, Spencer will eventually be able to realize Microsoft’s broader aim of having a significant effect on the mobile gaming market.