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Microsoft Makes a $69 Billion Down Payment on the Metaverse

Its deal for Activision Blizzard heats up the land grab for what Big Tech sees as its next frontier. 

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There are many reasons why Microsoft Corp. would have wanted to purchase Activision Blizzard Inc., which publishes a range of famous video game franchises, from Call of Duty to Candy Crush Saga. The $68.7 billion deal, which was announced on Jan. 18 and requires regulatory approval, would make Microsoft the third-largest gaming company in the world. But in Microsoft’s own explanation of the largest acquisition in its 46-year history, the word “metaverse” did a lot of the heavy lifting.

The metaverse refers to a new generation of computing where instead of switching between discrete apps, people enter a collection of immersive digital worlds, which they explore in the form of cartoon avatars. In the most ambitious version of this vision, people will be able to do whatever they do in the physical world with a sense of presence that hasn’t been available in online experiences, thanks to three-dimensional designs they can experience through augmented- or virtual-reality headsets.