🎮​​ A $69B gaming deal - The Hustle
The Hustle

🎮​​ A $69B gaming deal

Never has the phrase “location, location, location” rung more true than with regard to a recent house sale in San Francisco’s Noe Valley. Despite being marketed as “the worst house on the best block” because of its rotting wood, boarded windows, and structural issues — the 122-year-old Victorian recently sold for $1.97m.

Today’s rundown:

  • $69B: Microsoft’s massive acquisition of Activision Blizzard, explained.
  • Dream job: You can make 6 figures walking dogs?
  • Chip problems: Why Canon is telling customers to ignore its warnings.
  • Around the web: Tips to avoid “money avoidance,” create your own 3D maps, and more wild internet finds.

Let’s do it.

The big idea

Microsoft acquires Activision Blizzard for $69B, explained

Last week, Take-Two Interactive made waves by acquiring mobile gaming studio Zynga for ~$13B.

Turns out, it was only a dress rehearsal for big gaming deals: On Tuesday, Microsoft announced that it’s acquiring Activision Blizzard for a jaw-dropping $69B.

It is the largest gaming tech deal ever (besting the $67B Dell-EMC merger).

Activision is the maker of blockbuster franchises…

including “Call of Duty,” “World of Warcraft,” “Candy Crush,” and “Tony Hawk’s Pro Skater.”

The company’s gaming empire has been shrouded in controversy over the past year.

According to CNBC, there have been “reports of sexual misconduct and harassment among the company’s executives.” Just Monday, Activision fired “dozens” of execs following a related investigation.

The deal is projected to close in 2023. If it passes regulatory scrutiny, Activision will report to Phil Spencer, the head of Microsoft’s Xbox division. (Embattled Activision CEO Bobby Kotick is expected to leave after the transition.)

Microsoft goes deeper into gaming

The software giant launched the Xbox console in 2001 and has since acquired 2 gaming platforms:

  • 2014: “Minecraft” creator Mojang for $2.5B
  • 2021: “Doom” and “Fallout” creator ZeniMax Media for $7.5B

In the near term, the deal will give the Xbox cloud gaming service a potential edge over PlayStation (and less-developed efforts from Netflix, Google, and Amazon).

In the long run, Activision provides Microsoft CEO Satya Nadella more talent and tools to build on his vision of an enterprise metaverse.

Nadella took over as CEO in 2014

At the time, Microsoft was valued at less than $400B. Today, it’s worth $2.2T+ as Nadella has successfully moved the company’s focus toward cloud technology.

Activision is now his largest acquisition ever, topping LinkedIn in 2016 ($26B) and Nuance Communications in 2021 ($20B).

While Microsoft stock fell ~2% on news of the deal, Nadella’s track record — *checks math* adding nearly $2T in market cap — means we should wait before passing judgment.

SNIPPETS

Recycled undies? Parade, the D2C underwear startup, launched a new recycling program that gives customers a 20% credit for recycling gently used underwear. #ecommerce-retail

Windy state: New York signed an agreement to utilize 2.5 GW of energy from offshore wind farms. #clean-energy

Walnut, a platform that helps businesses create product demos with no coding required, raised $35m after growing annual recurring revenue 700% since its last raise. #emerging-tech

NFT collab: Coinbase partnered with Mastercard to allow users to use credit cards on Coinbase’s new NFT marketplace. #fintech-crypto

No more originals: YouTube shut down its original content group, YouTube Originals, after 6 years, but will continue funding projects from its Black Voices and YouTube Kids funds. #big-tech

MFM: Sam and Shaan discuss the economics of book deals and how much authors actually make on their best-selling books. #mfm

Scooby-Dough

What it’s like to make $100k+ walking dogs

Dog ownership is increasing: 53% of American households now own dogs —up 22% since 2000.

This has led to something of a boom in recent years for individual dog walkers. At large, dog walking is an estimated $979m industry.

The average dog walking business pulls in ~$236k in revenue per year, per US Census Bureau data. On an individual level, salaries can be surprisingly robust.

“Any Joe Schmo can make $50k a year working for Rover,” says Ryan Stewart, one of America’s top-tier professional dog walkers.

“Someone who works for himself and can walk 2-3 dogs at once can make $100k. And if they’re really good, they can make $200k+.”

For our latest Sunday feature, we dove deep into the economics of dog walking.

Read the full story →
All That and No Chips

Why Canon is telling people to ignore its warnings

The chip shortage has claimed another victim. This time, it’s printer companies that want to make you use branded ink cartridges.

It’s all about a little thing called a DRM chip

Digital rights management (DRM) is tech that controls how someone can access or use content. Examples include software you can’t use until you enter a key, and streaming apps that won’t let you take screenshots.

In the case of printers, many companies — including Epson and HP — use DRM chips in their ink cartridges.

Customers who try to use cheaper, 3rd-party cartridges may get ominous warning messages or find they can’t print at all without a workaround, like downloading old firmware.

Enter the big chip shortage

Canon has been selling cartridges without the chips because, well, there aren’t any.

So now, some users are being warned about possible malfunctions when they try to print. Canon’s solution? Just ignore it, per Techdirt. That’s it.

Canon is also being sued over its “All-in-One” printers, which allegedly refuse to let users scan or fax if the ink cartridge is low or empty, so perhaps it’s time to rethink some things.

Fun fact: Keurig once tried to do the same thing with its coffee pods. Customers hated it.

AROUND THE WEB

🤪 On this day: In 2004, Democratic presidential candidate Howard Dean screamed during a campaign speech. The widely mimicked moment may have been the 1st political meme.

🧙‍♂️ Cure boredom: RPG Playground lets you create your own role-playing games or play games other people have made.

⚖️ That’s interesting: Jeanne Pouchain is alive, but the French government says otherwise. This frustrating, fascinating story details her quest to be “resurrected.”

🌍 Useful: This site helps you create and download your own 3D map.

💵 How to: “Money avoidance” is when we put off thinking about our finances. If that’s you, NPR has some tips for, well, avoiding avoidance.

👶🏼 Aww: And now, a Pomeranian attempts to crawl like its friend, a human baby.

Meme of the day

Tony Hawk’s Pro Skater = Activision Blizzard’s masterpiece (Source: iFunny)

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