Microsoft has announced its acquisition of ZeniMax Media Inc., for $7.5 billions in cash. ZeniMax is the parent company of various video game developers and publishers, including Bethesda Game Studios, id Software, ZeniMax Online Studios, Arkane, MachineGames, Tango Gameworks, Alpha Dog and Roundhouse Studios.
Through the acquisition, Microsoft is further capitalizing on an area which is benefitting from significant secular growth. Gaming is one the fastest growing industries in the world and is expected to reach over $200 billion annual revenue by 2021.
Microsoft's deal to buy some of the most critically acclaimed and best-selling gaming franchises like The Elder Scrolls and Fallout will mesh well with its existing console business. For example, Microsoft can now add various games acquired through this transaction to its Xbox Game Pass.