Microsoft to Acquire the Maker of Fallout and The Elder Scrolls Games for $7.5B

This week tech giant Microsoft announced that it is buying Bethesda, the maker of Fallout and The Elder Scroll games in a deal valued at $7.5 billion.

The company said it would buy ZeniMax Media, the company that owns well-known video game publisher Bethesda.
The all-cash deal will give Microsoft access to a raft of successful game franchises, including Fallout, The Elder Scrolls and Doom.

This gaming purchase is the biggest in Microsoft’s history. In 2014 the company had purchased Minecraft developer Mojang for $2.5 billion.

“Gaming is the most expansive category in the entertainment industry, as people everywhere turn to gaming to connect, socialize and play with their friends,” Microsoft CEO Satya Nadella said.

“With the addition of Bethesda, Microsoft will grow from 15 to 23 creative studio teams and will be adding Bethesda’s iconic franchises to Xbox Game Pass,” Microsoft said. “This includes Microsoft’s intent to bring Bethesda’s future games into Xbox Game Pass the same day they launch on Xbox or PC.”

Speaking Monday on CNBC’s “Squawk Alley,” Microsoft Xbox head Phil Spencer said ZeniMax would continue to operate independently following the acquisition and suggested there would be no cuts at the company.
“Our plan is to leave it alone,” Spencer said. “ZeniMax has an amazing track record of building great games. Our goal is to make ZeniMax the best ZeniMax they can be.”

“This announcement comes at a critical time,” George Jijiashvili, a senior analyst at Omdia, told CNBC. “The lead-up to the launch of the next-gen consoles is when gamers pick their ‘religion.’”

According to Jijiashvili, Microsoft could launch Bethesda games as exclusive Xbox titles and they would not
be available on other platforms such as the PS4, PS5 and Nintendo Switch.

“The delay to Halo Infinite, the most anticipated Xbox exclusive, is a huge blow to Microsoft, but it is betting that Game Pass will sway gamers in the long run, thanks to day-one launches, cloud gaming and a growing library of appealing games,” Jijiashvili said. “The question of exclusivity now looms large. Microsoft has not opted for the exclusive route with its past acquisitions, but this may change given the scale of this acquisition.”

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.