“Gaming
is a top activity spanning devices, from PCs and consoles to tablets and
mobile, with billions of hours spent each year. Minecraft
is more than a great game franchise – it is an open world platform, driven by a
vibrant community we care deeply about, and rich with new opportunities for
that community and for Microsoft.”
Microsoft CEO Satya
Nadella statement on the purchase of Mojang and their successful indie-game
title, Minecraft
It’s
only fitting after all, considering that they already have their own Gaming
System, the Xbox.
I’m
of course referring to Microsoft’s purchase of
Mojang and their indie-hit game, Minecraft
for US$2.5 billion dollars as announced in the article “Microsoft
Makes $2.5 Billion Gamble On Indie Hit 'Minecraft'”, published 9/15/2014 @ 12:23PM by Erik Kain, Forbes and “Microsoft
to buy Minecraft maker Mojang for $2.5B”, published September 15, 2014 6:12
AM PDT by Ian Sherr, CNET News.
Mojang
marks the first major acquisition under the leadership of Microsoft CEO Satya
Nadella and already it has many confused. This as albeit Minecraft is a popular Video game, the
rationale for spending so much money on a single Video game studio and Video
game title seems strange. Especially as it’s his first major acquisition as
CEO.
As
for Mojang, they seem to be taking the acquisition well. They plan to move on
to develope new Projects, as five (5) years of doing the same thing since 2009
does get a little boring, to quote Mojang CEO Carl Manneh: “The ‘Minecraft’
players have taken the game and turned it into something that surpassed all of
our expectations. The acquisition by Microsoft brings a new chapter to the
incredible story of ‘Minecraft. As the founders move on to start new projects,
we believe the high level of creativity from the community will continue the
game’s success far into the future”.
 |
Even
the Minecraft creator Markus “Notch”
Persson was nonchalant, say it was more about moving on with his life and not
so much about the money, big words for someone already making millions from a
game he made for the fun of Gaming as stated in the article “'Minecraft'
Creator On $2.5 Billion Deal: 'It's Not About The Money'”, published
9/15/2014 @ 11:23AM by Dave Thier, Forbes.
So
who did Microsoft make this odd move?
Microsoft
purchases Minecraft – US$2.5 billion a coup for the 40-employee strong Swedish
Company
It’s
good to take a look at the history behind what’s been a great five (5) year run
for the Mojang Team at this point.
Mojang’s
is a Swedish based Game developer led Swedish Game Developer Markkus “Notch”
Persson who started Mojang with his first set of employees in September 2009 as
chronicled in my Geezam blog article
entitled “MineCraft
– Indie hit is Social Gaming’s Cinderella”.
They’ve
grown from strength to strength ever since making an app for Minecraft for the Apple iPhone and the Apple
iPad and getting immortalized in LEGO Bricks since December 2011 as explained
in my Geezam blog article entitled “Minecraft
Apple iPhone and iPad making brick building Games Social”. It’s around this
time he relinquished the leadership role to Mojang's Jens Bergensten as the game
gradually gained a huge following.
 |
Even
the Brits have taken a liking to Minecraft,
with the Great Britain's Governmental-mapping Agency Ordnance Survey,
recreating the Entire Country of Great Britain within the game in September
2013 as explained in my Geezam blog
article “Map
of Great Britain in Minecraft is a Brick Builders Dream Landscape made Real”.
Now,
quite fittingly, Warner Brother in February 2014 has announced plans to make a Minecraft movie after the success of the Lego
Movie as explained in my Geezam blog
article “Warner
Brothers to make MineCraft movie following Success of The Lego Movie”.
Their
loyal followers have grown on almost all gaming platforms in 2014 according to
the article “MineCraft
passes 100 million registered users, 14.3 million sales on PC”, published
February 26, 2014 by Eddie Makuch, GameSpot
1.
100 Million Users
2.
14.3% or 14.3 million have purchased the
Game
3.
10 million copies each downloaded from
the Google Play Store and the Apple iTunes store
4.
1 million copies have been downloaded on
the PlayStation 3 since December 2013 Launch
To
their loyal followers, Mojang had this to say on their blog, quote: “Change is
scary, and this is a big change for all of us. It’s going to be good though.
Everything is going to be OK. Minecraft
will continue to evolve, just like it has since the start of development. We
don’t know specific plans for Minecraft’s
future yet, but we do know that everyone involved wants the community to grow
and become even more amazing than it’s ever been. Stopping players making cool
stuff is not in anyone’s interests.”
Thus
this recent purchase of their company, some five (5) years later for US$2.5
billion, while being an odd move by Microsoft CEO Satya Nadella as it’s a
non-core product as it relates to Microsoft’s business, is a coup for the
40-employee strong Swedish Company!
Microsoft is buying the
Minecraft Universe – Reaching potential future gamer to build on Xbox Success
Minecraft makes some US$129 million in profit
in 2013 according to figures presented in the article “Minecraft
Is Still Generating Insane Amounts of Cash for Developer Mojang”, published
March 18, 2014 by Victor Luckerson, TIME.
At
that rate, it would take Mojang 20 years to make back Microsoft’s investment in
their company. Then again, former Microsoft CEO Steve Balmer’s purchase of
struggling Finnish phone maker Nokia for US$7 billion is just as bad and
possibly worse as noted in “Xbox
Not A 'Core' Part Of Microsoft's Business CEO Says”, published 7/15/2014 @
4:11PM by Erik Kain, Forbes
Nokia
shows no signs of their Windows Phone powered Lumia series smartphones making
serious inroads into the highly competitive consumer smartphone market that
currently ruled by Google Android and Apple as noted in my blog article
entitled “IDC
Stats for Second Quarter of 2014 points to Asian Smartphone Rise – How cheaper
smartphones are slowly killing BOTH Apple and Samsung marketshare”.
Thus
if the Microsoft CEO Steve Balmer can make such a huge gamble on Video Games,
especially given their profitability potential as noted in on my blog
article entitled “Netzoo's
2014 Global Games Market Report - Developed World idle time Opportunity for
Jamaicans in Video Gaming Design”, then Microsoft CEO Satya Nadella gamble
is a safe bet by comparison as Mojang’s Minecraft
community shows signs of growing, especially
among Teenagers (ages 13 to 17)!
So
in summary, Microsoft has invested in a company that’s not only poised for
growth but with a loss less cash than a typical company. This, folks isn’t a
real gamble. It’s a safe bet on a game which has little challenge in its little
niche and is set for growth all the way for the next 20 years.
Whether
or not Microsoft will make a profit is another thing. But Mojang isn’t a loss
making entity that they’ll have to pump billions into to make it profitable
like Nokia, so by comparison, this will work our quite handsomely for them.
Best of all, it taps into that Teenagers (ages 13 to 17) gaming segment that
they’ve long ignored.
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