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Microsoft's mobile mishaps: Why the Activision Blizzard deal had to happen

The tech giant has had a troubled history on mobile. Could gaming's biggest ever deal finally put right their wrongs?
Microsoft's mobile mishaps: Why the Activision Blizzard deal had to happen
  • Late to the party and playing catch-up ever since Microsoft history on mobile is littered with false starts.
  • Microsoft's are pinning their hopes on the acquisition of Activision Blizzard to finally make good on their mistakes.

Microsoft has finally received the CMA’s approval to close its acquisition of Activision Blizzard, and now the deal is finally done.

But what's led the computing and cloud giant to this point. Why was acquiring Activision Blizzard such a big deal (literally) and why was their mobile element - specifically the publisher and developer King - such a big part of the story?

With their deal now in place it appears that Microsoft are finally in a position to put right all their mobile mistakes.

Dawn of the iPhone

Time has proved that the advent of the iPhone in 2007 wasn't just the launch of a new handheld, but a monumental moment in hi-tech history. The iPhone wasn't just another 'smartphone' of the day, but the first time that novelties such as a touchscreen, inertial scrolling, pinch-to-zoom and the REAL internet in your pocket were seen by mortal eyes. 

Surely any rival would be quaking in their boots. Not so but Microsoft who were - at least initially - skeptical of the prospects of the technology, with CEO at the time Steve Ballmer literally laughing at the idea that it would take off. The now-departed mouthpiece famously stated that, “There’s no chance that the iPhone is going to get any significant market share. No chance.”

Blame Microsoft's dominance on desktop and their long history of having everything their own way. By 2007 Windows (and the Microsoft Office suite that ran on it) were the untouchable centrepiece of the entire computing industry, running on large, hot and heavy PCs on every desktop.

What did mobile matter? The screen was too small, there was no mouse or keyboard and REAL computers were always going to be more powerful, right?

But Ballmer’s laughter was short lived - the iPhone proved to be a massive success by virtue of doing a few carefully selected tasks incredibly well, and by the time the Google Android was released in 2008, Microsoft realised that the next wave of innovation was going to be in your pocket…

Windows! On a phone!

Microsoft's hesitation cost Windows the mobile market, and when the Windows Phone launched it 2010 it did so into an already crowded market. iPhone, as the first to market and a premium priced device was hoovering up the high end, while cheaper 'good enough' Android phones took care of the rest.

Sure, Windows Phone was integrated heavily into the Windows operating system, sharing many of the looks, 'tiles' and features of the time but, thanks to the ties to the desktop that Microsoft couldn't bring themselves to sever, it was neither as powerful as the iPhone nor as cheap as Android.

Worth mentioning at this point that this wasn’t the first time that Microsoft - for all its market dominance - was slow on the uptake with handheld devices. Apple's iPod, the breakthrough digital music player that famously put "a thousand songs in your pocket”, came out in 2001, instantly proving to be a success. It took Microsoft five years to release its own competing device, the Zune, which failed to gain market traction and was discontinued in 2011.

In short, Microsoft's love of the desktop had given them a subconscious disregard for anything mobile.

N-Gage with change

Ok. Time for some major course correction and with billions at their disposal, couldn't Microsoft just buy a mobile phone company that was already making great phones?

Microsoft has a long history of acquiring companies that make great things. Whether that’s Skype, Powerpoint, or game developer Mojang. By doing so, they've been able to capitalise on the ideas of others and in the mobile space alone the company acquired the likes of Datazen, BlueStripe, Capptain, and Xamarin to keep the wheels on their plans.

But the biggest mobile grab was still to come. Eager for a running start (and too far behind to start again) Microsoft sprang the big bucks and bought world famous and highly regarded Finish mobile maker Nokia for the not inconsiderable sum of €5.44 billion in 2011.

Nokia had spent years being ahead of its time. Their range of phones has sprialed to produce something for everyone with models such as the easy-to-use, tough and practical 3310 (complete with mobile classic Snake on board) being ubiquitous globally.

The company had also released the first gaming smartphone, the Nokia N-Gage, in 2003 and as such, while Apple and Google dominated the market, Nokia had a keen eye for identifying upcoming trends and had worked their magic time and time again by the point of Microsoft's move-in.

However, even with Nokia's hardware smarts now propping up the Windows Phone banner, the race was already lost. Developers made their apps for Apple and Google as that's where the audience was with Windows Phone increasingly left out of the picture. 

From hard to soft… 

In 2017 Microsoft gave up on Windows Phone and got out of the hardware game. Instead it refocused on what had made the company its big bucks in the past - software.

Instead the company began to make some serious acquisitions in the multi-platform software scene. Major game developers such as Zenimax Media and Ninja Theory came under their wing and tentative mobile plans - with a 100% software focus - have been on the cards ever since. But to really set things in motion a bigger play was required.

Activision Blizzard had already done the hard work. In acquiring King in for a pricey-at-the-time $5.9 billion in 2011 they'd effectively armed themselves with artillery in every gaming space. And - for a company like Microsoft, complete with its Xbox business and hopes to right mobile wrongs - made themselves irresistible in the process.

The company has long claimed that the deal is due to Activision Blizzard’s mobile presence, and arguably it’s a move it needs to make. With Sony also making steps to improve its mobile footprint, it seems that Microsoft has learned its lessons - and adding one of the biggest names in mobile to its portfolio goes some considerable way to making Microsoft mobile at last.

And while King and their mobile empire may be the heart of the deal, the fact that some of the world’s biggest cross-platform franchises are under its purview must be more than a mere bonus. 

As to what Microsoft will do with all its new toys and what suspected and potentially destructive new measures it will put in place, only time will tell. But you can bet that mini Microsoft tanks are being pushed over a shiny new map in Redmond right now.