Agency: Microsoft’s acquisition of Activision Blizzard will stimulate more mergers and acquisitions in the global gaming market

Venture capital firm Konway released a report today saying that Microsoft's $69 billion acquisition of Activision Blizzard will trigger more mergers and acquisitions in the global game market and create a new generation of game companies. Konway said in the report that currently publicly listed game companies are sitting on $45 billion in cash and cash equivalents, while the world's largest technology companies such as Apple, Google and Netflix have a total of $229.4 billion in cash, which is likely to lead to larger consolidation in the $188 billion video game market.

Citing the latest financial report data of these companies, Konway said in the report that game companies such as Activision Blizzard, Electronic Arts (EA), Singapore's Sea, Japan's Nintendo and Bandai Namco, South Korea's Nexon, and China's NetEase currently have $45.1 billion in cash and cash equivalents.

The world's largest technology companies, including Amazon, Microsoft, Google, Apple, Meta, Netflix, Tencent and Sony, have a total of US$229.4 billion in cash that can be used for potential mergers and acquisitions.

This will give them sufficient financial resources to find potential acquisition targets to help them expand their intellectual property and products. It also comes at a time when gaming companies are looking to keep players engaged for longer through live streaming services and paid subscription packages.

Josh Chapman, a partner at Konvoy, said that the deal between Microsoft and Activision Blizzard is expected to trigger further mergers and acquisitions and create a new generation of gaming companies. Last Friday, Microsoft announced the completion of its acquisition of Activision Blizzard, making it the third-largest gaming company in the world by revenue, behind Tencent and Sony.

"As active gaming investors, we believe gamers and gaming startups will benefit from this deal as it enhances the value proposition for gamers and creates a vibrant M&A environment for other transactions to be completed," Chapman said.

Konvoy also said that the global gaming industry will achieve long-term growth in the next few years, with a compound annual growth rate of 9% expected in the next five years. By 2028, the industry's total sales will reach a staggering $288 billion.