Microsoft Deal For 'Minecraft' Now Reportedly $2.5 Billion, What Is Microsoft's Angle?

Scott Grill

How big is Mojang's Minecraft? It's on the PC, PlayStation, Xbox, iPhone, iPad, and Android devices for starters. It's sold over 54 million copies total. A report last week indicated that Microsoft wanted to purchase the developer studio and the game for $2 billion. A new report Saturday claims the purchase amount is actually $500 million higher. Many are wondering why Microsoft would spend that amount of money for a single game franchise.

Microsoft will announce a $2.5 billion purchase of Mojang on Monday, according to sources with Reuters. This would make the deal larger than Facebook's acquisition of Oculus Rift for $2 billion in July.

The question many are asking with this deal is why would Microsoft spend such a large amount of money on a single game? Some believe this has less to do with the Xbox platforms and more to do with its mobile strategy for Windows Phone and Windows 8 tablets like the Microsoft Surface.

Minecraft Pocket Edition

The Mobile Market

Reuters obtains quotes from both a game developer and a Wall Street analyst to support this conjecture.

"It seems like Microsoft is looking at Mojang and Minecraft as a way to tap into this enormous cultural phenomenon," said Dave Bisceglia, Chief Executive of independent game studio Tap Lab. "If you look at iOS, 'Minecraft' has been a top-grossing game for quite some time, if Microsoft could on Windows phones give players a unique and compelling experience that you can't get on the other platforms, that could be a driver to sell devices to existing 'Minecraft' fans."

"We don't view this acquisition as a signal of Microsoft's intent to double down on Xbox but consider it an attempt to better address mobile on a cross-platform basis," said Nomura analyst Rick Sherlund in a note to clients this week. "This also appears to be consistent with (Microsoft) CEO Satya Nadella's mobile and cloud strategy."

The mobile segment is Minecraft's fastest growing base. Mojang's Jens "Jeb" Bergensten revealed that the Pocket Edition passed the 21 million sold mark back in April.

— Jens Bergensten (@jeb_) April 9, 2014

The potential for Minecraft in the mobile space is large, but it's unclear how the game will help Windows mobile devices. Windows smartphones from Nokia and HTC are just as powerful and filled with features as its Android and Apple competition. However, the devices have lacked both the "cool" factor of the other devices, the large marketplace of apps and app developers, and broad support from all the major carriers. Windows Phones sit in a very distant third with less than 3 percent of the smartphone market as a result, and its market share is actually contracting, as Phone Arena mentions.

Minecraft on Windows devices could help, but it won't solve these issues on its own.

A Platform and a Brand

What Microsoft may actually get with Minecraft is a popular platform that can span the PC, Xbox, and mobile devices. Additionally, it will own the brand that can expand into toys, books, and possibly even movies.

On the toy front alone, the LEGO Cuusoo Minecraft Micro World Sets have been so popular that LEGO is turning them into full-fledged regular size sets. LEGO announced just this past Thursday that six LEGO Minecraft sets will hit stores this November.

LEGO Minecraft

It seems unlikely that Microsoft would be able to force the end of support of Minecraft: PlayStation 4 Edition, PlayStation 3 Edition, and PS Vita Edition. That doesn't mean that future versions of Minecraft will be available on its competitor's consoles though.

As The Inquisitr reported before, any deal for Minecraft will likely not include Notch. The creator of the massive hit has not actively been involved in its development since 2011 and will reportedly depart once the ownership of Mojang and Minecraft transitions to Microsoft.

Microsoft is possibly looking at Minecraft as a franchise much in the same way that Nintendo looks at Super Mario as a franchise. It's a game with a seemingly infinite amount of growth and appeal to both kids and adults. It's surprising that Microsoft didn't make this move prior to Minecraft releasing on the PlayStation platforms, but now the question is will the $2.5 billion gamble payoff.

What do you think of the Minecraft deal for Microsoft? Are they paying too much? Are you worried about the future of the franchise? Let us know in the comments below.

[Images via Mojang, LEGO Minecraft Facebook]