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Also Metasoft, uh, Microsoft bets on the Metaverse


Microsoft declares war on Mark Zuckerberg with plans for the so-called Metaverse – with current billions in profits from its previous business areas behind it.

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A Microsoft office in New York

Photo: Swayne B Hall/AP

Satya Nadella would have liked to present the latest figures from his company.

In a conference call on Tuesday, he was able to rave about a "record quarter" and how well Microsoft is doing while the digital and real worlds are said to be getting closer and closer.

And indeed, Microsoft's results exceeded many analysts' expectations.

From October through December, the company increased its revenue by a fifth year over year to $51.7 billion.

It made a net profit of $18.8 billion, up 21 percent.

The business with cloud computing services in particular contributed to the good result.

However, revenue from the Microsoft platform Azure also increased by 46 percent.

And with an increase in sales of eight percent, the games division also made headway.

On the way to becoming the third largest game company

In the context of such quarterly results, Microsoft now outlined how it intends to invest its billions in profits.

One focus is on the gaming area, where the most expensive acquisition in gaming history is currently being planned, another on the development of a so-called metaverse, a virtual world that can be reached and entered with different devices.

"We feel very well positioned to surf what I believe is the next wave of the internet," Microsoft CEO Satya Nadella said on Tuesday.

Nadella also emphasized that his group's "big bets" on topics such as content, community and cloud had paid off.

The racing game Forza Horizon 5, which was released for PC and the newer Xbox consoles, and the shooter Halo infinite were particularly successful.

According to the company, they reached 18 and 20 million players respectively.

The most expensive acquisition in games history

"With our proposed acquisition of Activision Blizzard, we're investing to make it easier for people to play great games where they want, when they want, and how they want," Nadella added.

Microsoft announced its plans to buy the maker of games like Call of Duty and Candy Crush last week.

If the $68.7 billion takeover actually happens - which antitrust authorities could still prevent - Microsoft would become the third-largest games company in the world, behind the Chinese company Tencent and Sony.

(Read more about Microsoft's gaming deal here.)

By the way, company circles said on Tuesday that at least the next three "Call of Duty" games will also appear for Sony's Playstation, even if the Xbox manufacturer swallows Activision Blizzard.

Strong brands as a lure

The proposed deal fits Microsoft's ambitions around the metaverse: Activision Blizzard's big brands, which also include Diablo, Overwatch and StarCraft, could help the company increase the appeal of its monthly subscription called Xbox Game Pass, but also that of a future online world.

When it comes to creating the biggest, coolest, or most lucrative metaverse, Microsoft's main rivalry is Mark Zuckerberg's company, Meta.

But companies like Tencent also have plans to build such online universes.

They should all be willing to invest many billions of euros in the fight for shares in a future market.

Some online games are already considered to be early forms of metaverses, into which people not only immerse themselves to play video games, but also, for example, to hang out with friends virtually.

The block platform Minecraft, which has belonged to Microsoft since 2014, falls into this category of games.

The multiplayer role-playing game »World of Warcraft«, which is part of Activision Blizzard, can also be classified as a metaverse, depending on how the term, which comes from science fiction literature, is interpreted.

At an online conference, Satya Nadella emphasized that gamers are already building their own worlds in Minecraft and that they are willing to invest money in their avatars in games.

LinkedIn is also booming

Beyond the games and cloud services business, Microsoft also improved its results in traditional business areas, such as in the wake of the release of Windows 11. Sales around the Office suite and the associated data storage and processing services grew by in the past quarter 14 percent in the business customer sector and 15 percent in the private customer sector.

The career network LinkedIn even increased its sales by 37 percent.

Nadella also wants to prepare these areas for the era of metaverse.

In the future, the Teams collaboration platform will offer an option for meetings with virtual avatars called “Mesh for Teams”.

However, some analysts have expressed doubts as to whether change in the offices will come as quickly as Nadella would like us to believe.

You've seen how many stars of the early pandemic phase have "fallen," said Third Bridge analyst Scott Kessler.

An end to the corona measures could therefore lead to a decrease in demand for programs for the home office.

Kessler doubts that the growth at Microsoft associated with the change to working from home is “sustainable”.


Source: spiegel

All tech articles on 2022-01-26

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