The Cornerplay: Microsoft overpaid for Minecraft by $700 million

By Jeffrey Yuwono ยท 25 replies
Sep 18, 2014
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  1. [parsehtml]<p><a href=""><img alt="" src="" /></a></p> <p>Earlier this week it was confirmed that&nbsp;Microsoft is acquiring Minecraft maker Mojang&nbsp;for $2.5 billion. I&rsquo;ve got mixed feelings about the transaction.</p> <p>The strategic benefits are questionable and financially, <a href="">Minecraft is worth maybe $1.8 billion</a> &mdash; a valuation which assumes a sequel is as commercially successful as the original, and which assumes the intellectual property rights founder Markus Persson took out of Mojang are part of the transaction.</p> <p>The press is speculating that Microsoft is acquiring Minecraft so it can &ldquo;tap into a cultural phenomenon&rdquo; and entice players to Microsoft&rsquo;s platforms.</p> <p>I don&rsquo;t buy either explanation.</p> <p><a href="">Read the complete editorial.</a></p>[/parsehtml]
    Last edited by a moderator: Mar 6, 2015
  2. VitalyT

    VitalyT Russ-Puss Posts: 3,670   +1,960

    "It looks like you are trying too hard"

    Take a dumb idea, put it in a nice box, and from geek to a playboy in no time...

    P.S. Never underestimate people's stupidity ;)
  3. Scott Elsdon

    Scott Elsdon TS Rookie

    They overpaid for skype also, Billions they paid for that, when everyone knows you can download it for free.
  4. cliffordcooley

    cliffordcooley TS Guardian Fighter Posts: 9,738   +3,706

    Geez, I would have guessed at least 2 billion. It's now up to MS to prove to us they didn't.
    That would be the only way to grab my interest.
    There is no way to calculate that figure, until after sales.
    Last edited: Sep 18, 2014
  5. TheBigFatClown

    TheBigFatClown TS Guru Posts: 684   +254

    I called it in advance. So, I get 3 points. :) I thought that was way too high. See my comments on the news article revealing the original transaction.

    I also think Apple paid way too much money for "Beats". I think these companies do this on purpose to create a perception in the minds of the consumers that their crappy product is worth more than it actually is. If the internet wasn't as ubiquitous as it is, they probably could have bought Minecraft for as little as the overpayment alone. But I guess since perception means something there is some kind of strategy in all of this theatre.

    I also predict that Minecraft will be a freebie game in the next "Windows" operating system. With tons of nickel-and-dime DLC content to follow. You know the drug dealer routine basically.
    Last edited: Sep 18, 2014
    Julio Franco and Arris like this.
  6. They overpaid by 2.5 billion. Minecrafts stupid.
  7. ET3D

    ET3D TechSpot Paladin Posts: 1,384   +172

    It shouldn't take too long to find out what Microsoft gets from this, considering that it said that it "expects the acquisition to be break-even in FY15".

    Do you think that even 0.1% of Minecraft players have any idea how much Microsoft paid (or that it even bought the company that made the game)?
  8. tipstir

    tipstir TS Ambassador Posts: 2,477   +126

    I have an idea Microsoft and it won't cost you Billions!
  9. VitalyT

    VitalyT Russ-Puss Posts: 3,670   +1,960

    We all do. Some are naughtier than others...
  10. Puiu

    Puiu TS Evangelist Posts: 2,670   +1,102

    You have to understand that they aren't buying the game for just a 2 year plan. Minecraft is now very similar to Mario and Tetris when it comes to the future of the IP. An enormous amount of potential with a lot of secondary products (games, toys, clothing, other branded products, etc). They didn't pay so much just to make a profit early on.
    It's a gamble where they hope to do as well if not better than what facebook did with it's own purchases Remember the 19 bil for Whatsapp? Remember how everybody was laughing at them for paying so much? Nobody is laughing anymore. The same with Skype.
    Julio Franco likes this.
  11. money

    money TS Enthusiast Posts: 45   +9

    Normally I would say that Microsoft know what they are doing but after the initial Xbox One incredible stupidity I am not so sure anymore.
  12. SirGCal

    SirGCal TS Maniac Posts: 365   +137

    They plan to turn it into another data-miner, just like other popular apps today. Too bad. That's where they plan to recoup their money and make buckets more. It's all about information, not about the game.
  13. Gaara

    Gaara TS Booster Posts: 103   +26

    Don't worry M$ have the money.
  14. cmbjive

    cmbjive TS Booster Posts: 777   +138

    Obviously MS didn't think they overpaid for Minecraft, err, Mojang. Minecraft is a cultural phenomenon that, while I still don't understand, seems to only to continue to grow. The opportunity for the game is virtually endless and this is a game that made money during its beta period.

    The $700 million will probably be seen as small potatoes in the next few years.
    Julio Franco likes this.
  15. Misagt

    Misagt TS Addict Posts: 150   +88

    I see many ways MS will make their money back on this thing. First off they got control of Minecraft realms, a easy way to pay for a stable server. I think MS will be working on cornering the market for servers. I doubt they'll take away the ability to make your own server. But what they will do is change the licensing agreement so that if you want to change others for servers you won't be able to easily. MoJang didn't like the fact people were paying huge money for stuff like diamonds on private servers. With MS I think they will set up large servers you can play on add things like pvp and such and have the ability to do it well. That right there is one way to make money. Another thing I'm sure they will do is licensed skins. Also and I'm sure all you streamers out there don't want to even think about this but you have been making millions and millions from videos on Youtube. If MS wanted they can take all of that revenue or make anyone wanting to show minecraft videos. There are dozens of angles to go at this to make money from toys, movies, TV shows and much much more. I don't think MS over paid as I'm sure they have many more people spending a great time more time then I have thinking about this.
    Jeffrey Yuwono likes this.
  16. I would rather pay Roblox.
  17. brentcopeland

    brentcopeland TS Rookie

    This article stinks of.. Someone really old, that has no vision.

    Minecraft is much more than just $ - it's now institutional. It's Checkers or Chess. It's here to stay. No sequel needed. Minecraft will be played by this generation and the next 10. It's ingrained itself in the minds of well.. just about everyone. And when the kids playing it these days have kids, it's going to be the game handed down to their kids. Not the sequel. This version. The fact you think it needs a sequel shows you have no clue what is going on with minecraft.

    If Microsoft is smart, they will continue to let mojang run it like it is (the developers are still on board don't forget -- Notch, Carl and Jahkobs are leaving -- They haven't had anything to do with Minecraft for a few years now.

    trust me. go ahead and buy some Minecraft swag for your great grandchildren. they will love it, wear it, and probably be doing a video series on the game.

    2.5 billion? For Minecraft? That's a steal.
    cmbjive, MilwaukeeMike and Puiu like this.
  18. EEatGDL

    EEatGDL TS Evangelist Posts: 568   +241

    Whoa, stop right there cowboy. The amount of people who has bought it is not even 0.003% of the world's population, not even 10% of US population; let's assume a lot of piracy and that wouldn't make up to 50% of US population. Outside of people who actually know about it and videogames in general, is pretty unknown. I'm not interested in it myself, and only less than 2% of the people I know play it, so don't assume "everyone" will like it.

    That doesn't mean no one will like it nor love it, you just can't simply assume "just about everyone" will have the same opinion.
  19. MilwaukeeMike

    MilwaukeeMike TS Evangelist Posts: 2,890   +1,224

    Who says they have to? Perhaps that's the price of keeping the game out of the hands of a competitor. It's why FB paid so much for Whatsapp. It's not because the product was necessarily worth that much, but because keeping it away from your competition was worth that much.
  20. Jad Chaar

    Jad Chaar Elite Techno Geek Posts: 6,515   +974

    Well there is Skype Premium and ads. That is really where the money comes from.
  21. Trillionsin

    Trillionsin TS Evangelist Posts: 1,596   +257

    Arent we all about done playing minecraft anyways?
  22. Darth Shiv

    Darth Shiv TS Evangelist Posts: 1,811   +472

    Skype has a revenue model. Skye can call landlines and mobiles. Can't just say the product is free so it's worthless...
  23. Jeffrey Yuwono

    Jeffrey Yuwono TS Booster Topic Starter Posts: 30

    Ouch! Being old and blind sucks. :)
  24. EchtoGammut

    EchtoGammut TS Rookie

    I would wager merchandise sales for Mojang generates more revenue than the game itself.
  25. Holotus

    Holotus TS Enthusiast Posts: 68   +9

    Are you guys ready for the Microsoft Gate of DRM, paid subscriptions, and locked down content only accessible through the Windows Store? Microsoft is going to rape this game into submission, say goodbye to one of the greatest games ever made.

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