Microsoft Corporation (MSFT)’s Mojang Buy Hopes to Follow in Bungie’s Successful Footsteps

Microsoft Corporation (NASDAQ:MSFT)’s is hoping to channel the success of past video game developer acquisitions in the present, and their most recent purchase of Mojang puts them in a better position to do so than even those successful previous transactions did. As Norman Young, Senior Equity Analyst at Morningstar told CNBC yesterday, the built-in audience that comes along with Minecraft is substantial, and unlike anything they’ve purchased before.


“One of the last times, or one of the first times they did that actually, to promote their Xbox console when it was first coming out, and they bought the maker of Halo, which was Bungie. And that worked out alright for them. Halo is one of the best-selling franchises, game franchises for Xbox, and this is kind of a similar deal. What they’re really buying is an enormously passionate and enormous user base, somewhere in the nature of 50 to 100 million registered users across all platforms and devices, so that’s really what they’re getting out of this deal” Young said.

That Bungie deal turned out to be extremely important for Microsoft Corporation (NASDAQ:MSFT). Instead of appearing on PC’s and Macs as was originally planned, Halo was reworked into an Xbox exclusive and has since become Microsoft Corporation (NASDAQ:MSFT)’s most important and iconic video game series.

The series’ games became “system sellers”; exclusive games that are so good they encourage people to buy the console primarily for the ability to play those games. The series was so important to Microsoft Corporation (NASDAQ:MSFT) that they retained the rights to it when Bungie split from them and regained independence in 2007.

Unlike that deal, which at the time was for a relatively unheralded game developer best known for their action game Oni, the Mojang purchase comes with even more tangible immediate benefits. The game already has an extremely large following, and has become just as iconic in gaming as Halo eventually did. As Young mentioned, the series already has tie-ins with companies like Scholastic Corp (NASDAQ:SCHL), Lego, and Warner Bros.

The Mojang purchase could also prove important to Microsoft Corporation (NASDAQ:MSFT)’s mobile strategy. The games had not been licensed for play on Windows Phone devices, which was a glaring omission that would’ve made them less attractive to gamers and series fans. They will now be able to not only put the games on those devices, but to focus on them or give them exclusive content to tempt gamers to play those versions.

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