Microsoft, Minecraft and Mojang: Here's How to Make Sense of Microsoft's $2.5B Purchase
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After some speculation, it's official: Microsoft has purchased voxel-based sandbox game Minecraft for $2.5 billion. Maybe that makes perfect sense to you and maybe it doesn't. This past weekend as we discussed the massive purchase, my mother asked my why on earth Microsoft would want to buy Minecraft for anything approaching that much money. My answer? That it might be better to think of it in terms of why a company might want to buy Barbie or Lego. They're monolithic brands; highly recognizable, widely available and beloved by huge swathes of customers, both young and old. There are already teenagers who look at Minecraft with nostalgia right alongside people experiencing it for the very first time. It's a cultural touchstone.
But there's more to it than that. If you break this purchase down into its most basic economic terms, as analyst Michael Pachter did at GamesBeat 2014, it makes perfect sense. Polygon's Owen Good has picked the juiciest bits out of Pachter's comments on Microsoft's acquisition of Minecraft, and summarizes the issue succinctly:
Essentially, Microsoft expects to make more money from Minecraft than it would make if that $2.5 billion sat in the bank for a year and generated $25 million in interest. And yes, given the sales of the game — which just launched on Xbox One and PlayStation 4 — not to mention the merchandise licensing that Minecraft has seen to date, $25 million sounds like a very, very doable number.
For more, be sure to read Good's full piece on Polygon, or go straight to the source andwatch the archive of Pachter's GamesBeat talk over on Twitch.