Microsoft Confirms $2.5bn Minecraft Acquisition

Studio assures there's "no reason for" Minecraft to be deleted from rival devices; Markus Persson makes $1.75bn; Creator set to leave studio with co-founders.

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Mojang, the Sweden-based developer of Minecraft, has been acquired by Microsoft for a fee of around $2.5 billion.

In a blog post to fans, Mojang suggested the deal would not result in the deletion of Minecraft games and apps available on non-Microsoft devices.

"There’s no reason for the development, sales, and support of the PC/Mac, Xbox 360, Xbox One, PS3, PS4, Vita, iOS, and Android versions of Minecraft to stop," the studio wrote.

"Of course, Microsoft can’t make decisions for other companies or predict the choices that they might make in the future."

Microsoft said one key reason for the acquisition is "we believe in the power of content to unite people". It added that it expects the acquisition "to be break-even in FY15 on a GAAP basis." That means it expects to make the money back by April 2016.

Notably, Microsoft says that it expects the acquisition "to be break-even in FY15 on a GAAP basis." In other words, Microsoft believes it will make back what it has spent on Mojang and Minecraft by the end of this fiscal year (next June).

The software giant wrote: "Minecraft adds diversity to our game portfolio and helps us reach new gamers across multiple platforms. Gaming is the top activity across devices and we see great potential to continue to grow the Minecraft community and nurture the franchise. That is why we plan to continue to make Minecraft available across platforms--including iOS, Android and PlayStation, in addition to Xbox and PC."

Moving on

Minecraft creator Markus Persson, who owns 70 percent of the company, stands to make $1.75 billion from the deal (although how much of this is in cash, and how much is in shares, is unknown for now).

Markus Persson stands to make $1.75 billion from the deal
Markus Persson stands to make $1.75 billion from the deal

Persson, along with chief executive Carl Manneh and co-founder Jakob Porser, will be leaving the company.

Mojang's letter to fans explained that Persson never intended to have "the responsibility of owning a company of such global significance".

It added: "Over the past few years he’s made attempts to work on smaller projects, but the pressure of owning Minecraft became too much for him to handle. The only option was to sell Mojang. He'll continue to do cool stuff though. Don't worry about that."

Mojang claimed that there "are only a handful of potential buyers with the resources to grow Minecraft on a scale that it deserves."

Minecraft has sold more than 50 million units across console, PC, smartphones and tablets. But it was Mojang's partnership with Microsoft for the Xbox 360 edition that forged ties between the two companies.

"We’ve worked closely with Microsoft since 2012, and have been impressed by their continued dedication to our game and its development," the studio wrote.

"We’re confident that Minecraft will continue to grow in an awesome way."

Xbox head Phil Spencer added: "We respect the brand and independent spirit that has made Minecraft great, and we’ll carry on the tradition of innovation to move the franchise forward. Our investments in cloud, Xbox Live and mobile technology will enable players to benefit from richer and faster worlds, more powerful development tools, and more opportunities to connect with the Minecraft community."

In other related developments;

  • Mojang says it is not sure on the future of its Scrolls games project.
  • The studio adds that it does not have insight into Microsoft's future for Minecraft
  • The Minecon event has not been cancelled and will be organised by Microsoft
  • Microsoft says Minecraft Xbox 360 edition has clocked up two billion hours played in the past two years

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SingletreeAve

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Here's some perspective on a $2.5B deal. 500M Xbox Ones x $500 = $2.5B. That's right. MS basically spent the equivalent of total XBox One revenue on a single game that is not even exclusive to that platform. That's revenue, not profit which is substantially less. In other words a lot of eggs in a basket that has already been mined for 50 million copies. I don't know if it's genius or foolishness, but it sure smells like a long ball from Phil Spencer. I think his job depends on whether or not gamers buy into it. Very few games put up those kind of sales numbers. My prediction is that they will milk the name with lame Mobile games until they release a Minecraft 2 in a couple of years. Whatever happens, Notch is my hero. $1.75B in your pocket... not a bad paycheck dude.

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GamerLegend10

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<< LINK REMOVED >> You mean 5m?

500M Xbox Ones x $500 = $250B not $2.5b :)

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SingletreeAve

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<< LINK REMOVED >><< LINK REMOVED >> True. I actually meant 5M units which does equate to $2.5B. If they sell 500 million Xbox Ones then any other money they throw around is irrelevant. :)

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xdude85

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All that money wasted on a down-syndrome Sims... way to go Microsoft.

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Daian

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If M$ will make their money back in just 1 year why the hek did he sell it when he could make billions in the next few years?

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clqtte

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People already got bore with Minecraft, haven't they?....

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MigGui

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what exactly can microsoft gain from this? it's not like minecraft is gonna sell 170 million more units at $15 each.

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Dawnshadow

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<< LINK REMOVED >> Maybe not 170 million more units, at least not quickly. But there's a Minecraft movie in production, T-shirts, foam pickaxes, crepeer plushies that hissss when squeezed, Minecraft branded legos, Halloween costumes, hoodies...


Even if they never sell another copy of Minecraft (and never make any spinoffs) there's still a lot of money to be made off the brand.

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SaturatedButter

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@Dawnshadow Except that they plan to make the 2.5 billion back by fiscal year's end, which is like June 2015. They're not going to make that in just a film and merch.

My guess is they're going to monetize servers. Maybe make official servers and shut down private ones. There's lots of money being made in Minecraft servers.

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VibroKnife

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1:37 "Not always true that the most effort goes into the biggest tits"

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Shantmaster_K

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Good buy by MS.

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SingletreeAve

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<< LINK REMOVED >> Or is it good bye Microsoft? Time will tell.

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console_war_vet

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<< LINK REMOVED >><< LINK REMOVED >> This was such a small amount of money in comparison to how much they have. It's a no lose situation for them.

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SaturatedButter

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<< LINK REMOVED >><< LINK REMOVED >><< LINK REMOVED >> Didn't Microsoft just recently sack a large amount of their employees?

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SingletreeAve

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<< LINK REMOVED >><< LINK REMOVED >><< LINK REMOVED >> Yeah, it's not going to put them out of business either way, but 2.5B is not a no lose situation. How many games have generated that much revenue in less than two years? Especially one that has already sold 35 million copies.

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console_war_vet

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The best part about this deal is that Phil Spencer just taught me how to pronounce Mojang in the video above.

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sladakrobot

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<< LINK REMOVED >> I thought it sounds like Mahjong

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SaturatedButter

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<< LINK REMOVED >><< LINK REMOVED >> Sounded like Mo-yang

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nurnberg

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Wow, talk about a bad investment! 2.5 billions for a fad game.

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console_war_vet

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<< LINK REMOVED >> A Flappy Bird deal is in the works...should be announced next week. Keep it on the down-low.

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PSXp-ONE

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Lol by SONY?

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<< LINK REMOVED >> trolololololol

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DeadorRock

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How the #uck MS plan to get the 2.5 billion back by 2016? Has Minecraft been the holy grail of gaming this whole time and I wasn't aware of it? I mean, either the suits at MS are really clueless about the whole gaming industry or they are freaking geniuses. To me the former is a lot more likely than the latter, but we'll see. I just don't understand how Minecraft can be worth 2.5 billion.

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sladakrobot

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<< LINK REMOVED >> Every future PS3,PS4 and Vita gamer will contribute to MS pockets.

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Pupchu

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<< LINK REMOVED >><< LINK REMOVED >> F#ck! They are invading! :O

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Pupchu

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RIP Minecraft

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JakeTehNub

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<< LINK REMOVED >> Minecraft died long ago

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Blazen702

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The head developer and lead designer are staying with Mojang

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Xristophoros

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i am very confused by this acquisition. why is an old franchise that everyone has played by this point worth $2.5 billion dollars? sales have already reached their peak for minecraft and will decline from here on out. now, if they are planning on developing a minecraft sequel (minecraft 2: pixels forever, etc) and make it exclusive to 360, x1 and pc, then MAYBE they will make some money back? but even then, a game like minecraft doesn't need a sequel and wouldn't really benefit from one due to the nature of the game and endless mod possibilities.


which brings me to a concern i think a lot of people have. will microsoft implement microtransactions into all builds of the game at a later time? will they turn it into a free to play model and force users to buy various resources, items and maps and strip away all the was great with the game in hopes of exploiting players? this is a real possibility that i wouldn't rule out. if not this scenario, i don't see why else microsoft would want to get its dirty little hands on this franchise.



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DarkReign2022

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<< LINK REMOVED >> Why does everybody assume Microsoft is going to pack the game with Microtransactions? When has any Microsoft-developed game ever been packed with microtransactions? Besides, the couple of F2P games they've released, which is to be expected, the closest they've come to it is the weapon skins in Gears of War, which are optional, add nothing to the game, and you're an idiot if you bought one in the first place and deserve to have your money taken from you Unlike publishers like Capcom and EA, who hide entire game modes behind paywalls, Microsoft has never actually released a game that was incomplete or inaccessible without further access to your credit card. Hell, Halo 4's Spartan Ops mode would've been an easily chargeable DLC pack, but all 10 weeks of episodic content were instead included in the original pricetag.

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Xristophoros

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<< LINK REMOVED >> microsoft hurt both, forza 5 and killer instinct, with microtransactions.

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BDRTFM

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<< LINK REMOVED >><< LINK REMOVED >> So, kind of like DriveClub?

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sladakrobot

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<< LINK REMOVED >> Do you know what MT did in Forza 5?

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BDRTFM

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<< LINK REMOVED >><< LINK REMOVED >> This is the Internet. If someone was donating money to save starving children, someone would find fault in it. MS=Evil. Sony=Advocate for Gamers. That's just the way it is.

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alaannn

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<< LINK REMOVED >> the only way it makes sense is ms said we dont have any good devs anymore lets buy one,wheres they should off went about trying to fix why they cant hold onto good devs and then getting there own francises back upto a good standard

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sladakrobot

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<< LINK REMOVED >> Wrong!
Minecraft will be going big on mobile devices and MS wants that money.

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alaannn

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<< LINK REMOVED >><< LINK REMOVED >> do you think theres 2.5 billion worth in a mobile game outside stupid investors or being bought out they will never make that money back

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sladakrobot

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<< LINK REMOVED >> MS thinks they will get their money back already mid 2015,latest 2016

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alaannn

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very bad purchase this new ms head is as stupid as the ones they just got rid off

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