Shares of Japanese technology giant Sony have seen a sharp decline in Tokyo trade after its main rival Microsoft said it plans to buy mega games company Activision Blizzard. Its shares fell 9% on Wednesday.
The deal worth $68.7 bn, would be Microsoft's biggest ever buyout and the largest deal in gaming history, destablising the market for Sony, whose PlayStation has enjoyed a lead in the generational battle with Microsoft's Xbox.
The purchase of the "Call of Duty" maker comes as Microsoft is aggressively expanding its Game Pass subscription service to counter Sony's position in the gaming market.
It would see the US firm owning popular gaming franchises including Call of Duty, Warcraft and Overwatch.
The deal would be a major step for Microsoft's Xbox gaming brand in its battle against Sony's PlayStation, the report said.
It also comes a year after Microsoft bought another influential gaming company, Bethesda for $7.5 billion.
Buying the troubled but successful Activision would turn Microsoft into the world's third-biggest gaming company by revenue, behind China's Tencent and Sony, marking a major shift for the industry, the report said.
Microsoft said the Activision-Blizzard deal would help it grow its gaming business across mobile, PC and consoles as well as providing the building blocks for the metaverse.
The purchase of the Call of Duty maker comes as Microsoft is also aggressively expanding its Game Pass subscription service.
"We're investing deeply in world-class content, community and the cloud to usher in a new era of gaming that puts players and creators first and makes gaming safe, inclusive and accessible to all," MIcrossoft's chief executive Satya Nadella said.
