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Activision Blizzard Purchase of Company That Makes “Candy Crush”

Activision Blizzard Purchase of Company That Makes 'Candy Crush'

The company behind video game franchises “Call of Duty” and “Destiny” has acquired King Digital Entertainment for $5.9 billion, the companies announced Monday.

Describing the deal, King CEO Riccardo Zacconi said that his company had built one of the largest networks of players on Facebook and on mobile devices, noting that King’s games had 474 million monthly active users in the third quarter of 2015.

Activision already owns one of the biggest gaming franchises in Call of Duty, in addition toDestiny and huge properties such as World of WarCraft and StarCraft as a result of its merger with Blizzard in 2008. The company’s gaming portfolio grows even bigger with the addition of the biggest name in social gaming, but there’s no guarantee King will be able to keep up its success forever. The Financial Times notes that although the company — founded in Sweden and now headquartered in the Republic of Ireland — has tried to reduce its reliance on the Candy Crush series since its launch in 2012, the app still accounts for a third of its profits.

WILL CANDY CRUSH BECOME ANOTHER ANGRY BIRDS?

Consumer spending on Candy Crush fell 13 percent year-on-year in the second quarter of this year, suggesting that King may follow other social game companies in becoming one-hit wonders. Finnish company Rovio, for example, originally profited greatly from the success of Angry Birds after its release in 2009, but failed to replicate its success with future games, seeing its profits drop 73 percent in 2014 alone and having to lay off more than a hundred staff members to cover the drop in player interest.

Nonetheless, the move gives Activision Blizzard instant access to a huge mobile market. The company has traditionally focused on console and PC games, with just five percent of its net revenue coming from the mobile sector in its latest earnings report. With the addition of King, the publisher now gets to reach over half-a-billion people in 196 countries, a move that it says will generate $36 billion in revenue by the end of this year. But while the decision to acquire King will add a lot to Activision Blizzard’s bottom line, it likely won’t endear the much-maligned publisher to gamers at large, who have blasted boss Bobby Kotick for his apparent focus on money rather than the people who play his company’s games.

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