Microsoft to buy creator of Doom and Fallout games for $7.5bn

The gaming industry is set to generate revenue of $159.3bn this year, according to Newzoo

The Microsoft Technology Centre near Times Square. The software giant is paying $7.5bn to acquire Zenimax Media and add a stable of game franchises including Fallout, Doom and The Elder Scrolls to itsShow more

Microsoft is acquiring the parent company of Bethesda Softworks, the developer of games such as Doom, Fallout and The Elder Scrolls, for $7.5 billion (Dh27.5bn).

The deal for Zenimax Media will bring "an impressive portfolio of games, technology and talent" to Microsoft's Xbox platform, the company said in a statement on Monday.

“Gaming is the most expansive category in the entertainment industry, as people everywhere turn to gaming to connect, socialise and play with their friends,” Microsoft's chief executive, Satya Nadella, said. “As a proven game developer and publisher, Bethesda has seen success across every category of games, and together we will further our ambition to empower the more than three billion gamers worldwide.”

The games industry is now worth more than the music and the film industry combined, with a report from consultancy Newzoo forecasting industry revenue of about $159.3bn this year, a 9.3 per cent annual increase. This is set to grow to more than $200bn by 2023 as user numbers climb above 3 billion.

Microsoft is expected to release the latest version of its Xbox console, the Xbox Series X, on November 10. The platform is much faster than its predecessor, offering frame rates of 120 frames per second and what the company describes as a 'True 4K' resolution.

However, Microsoft said its strategy recognises the move "from a device-centric era to a player-centric era" and is focused on allowing gamers to play what they want on whatever devices they want, adding that Xbox Game Pass – its game subscription service – now has more than 15 million subscribers.

Zenimax Media was founded in 1999 by Robert Altman and has 2,300 employees in games development studios and publishing offices around the world. The company's existing structure and management team will be maintained, Microsoft said.

"We have enjoyed a close partnership with Microsoft for decades, and this deal is a natural progression of those years working together,” Mr Altman said.

The deal is subject to regulatory and other approvals and is expected to close in the second half of its 2021 fiscal year, which ends in June next year.