Microsoft is constructing an Xbox mobile shop to directly provide games on mobile devices to compete with Apple and Google. The software behemoth initially alluded to a “next-generation” shop it would “build for games” earlier this year but has now covertly disclosed specifics of the plans in files with the UK’s Competition and Markets Authority (CMA).
Microsoft Believes its Mobile Store Will be Beneficial for the Industry
Microsoft has been asked for background information by the CMA, which is now looking into the $68.7 billion Activision Blizzard deal. Microsoft claims that a key driving factor for the acquisition was to expand its mobile gaming footprint. It appears that it has intentions for this area, including the development of an Xbox mobile game shop and platform. The corporation states the following in its filings:
The transaction will improve Microsoft’s ability to create a next generation game store which operates across a range of devices, including mobile as a result of the addition of Activision Blizzard’s content. Building on Activision Blizzard’s existing communities of gamers, Xbox will seek to scale the Xbox Store to mobile, attracting gamers to a new Xbox Mobile Platform. Shifting consumers away from the Google Play Store and App Store on mobile devices will, however, require a major shift in consumer behavior. Microsoft hopes that by offering well-known and popular content, gamers will be more inclined to try something new.”
Microsoft has been positioning Xbox Cloud Gaming as a mobile gaming alternative for new portable devices, and the corporation has officially acknowledged a push for mobile gaming. Microsoft was fast to work with Logitech and Razer for their cloud gaming-focused handhelds after supporting Xbox Cloud Gaming on Valve’s Steam Deck. This suggests that there may be a push towards mobile gaming across a variety of platforms, not just smartphones and tablets.
In addition to hardware, a lot of money is at risk here. The most downloaded apps on mobile devices are games, which also fuel in-app purchases on app stores. Take a look at how the business presents the opportunity:
The transaction gives Microsoft a meaningful presence in mobile gaming. Mobile gaming revenues from the King division and titles such as Call of Duty: Mobile, as well as ancillary revenue, represented more than half of Activision Blizzard’s revenues in the first half of 2022. Mobile customers account for around three-quarters of its MAU. Microsoft currently has no meaningful presence in mobile gaming and the Transaction will bring much needed expertise in mobile game development, marketing and advertising.”
The CMA has, however, hardly addressed the possibility of Microsoft entering the mobile gaming sector as part of its probe and is instead primarily concentrating on console gaming, which Microsoft contends is a shrinking portion of the total business. It is now the unfortunate responsibility of the CMA and other regulators to sort through these disputes between Sony and Microsoft and determine just how this acquisition could hurt consumers or the competition.
Microsoft will need to court third-party developers if it intends to make advances, as creating a viable alternative to the Google Play Store or App Store would be extremely difficult. Microsoft still aims to complete the Activision transaction by the spring of 2023, but there’s a strong possibility we’ll face months of skirmishes along the way – as well as the potential to learn uncommon details about the game industry’s hidden goals, as with these mobile plans.
Source: The Verge