Microsoft buying Mojang: End of an era or brave new world?

What happens when a tech giant buys up an indie kids game? Minecraft fans are about to find out. But according to analysts, it might not be the end of the world.
September 18, 2014

Dear Microsoft: Please don’t mess it up. This is the gist of 10-year-old Sabrina Lane’s open letter to Microsoft CEO Satya Nadella, following the tech giant’s $US2.5-billion purchase of Swedish gaming phenomon Mojang, the company behind the popular sandbox-style game Minecraft. In her letter, originally posted on Fortune, Lane quite simply pleads: “Kids like me – and teens – love the game, so I have a message for you and everyone at Microsoft: please don’t change it!”

The sentiment is being echoed by gaming fans young and old, who are expressing concern over the indie studio being purchased by the tech behemoth, which is rushing to assure fans that the buy does not mean game over for Minecraft.

“Change is scary, and this is a big change for all of us. It’s going to be good though. Everything is going to be OK,” Mojang said in a post confirming the sale, adding that Microsoft was one of only a handful of buyers with the resources to grow Minecraft to the scale it deserves.

The gaming outfit founded by Minecraft creator Markus “Notch” Persson has seen explosive growth since its 2009 launch. The 40-person studio pulled in US$326 million in revenue in 2013, up from US$128 million in 2012. Meanwhile, Minecraft has sold more than 54 million units across platforms, netting over 100 million downloads on PCs alone.

While the deal is not unprecedented—it follows Amazon’s recent acquisition of video gaming network Twitch for US$970 million and Facebook’s buy-up of Oculus Rift for US$2 billion—it’s unusual that the company’s founders, including Notch, will be leaving the company immediately after it’s acquired.

Having built up the gaming empire, Notch and the company’s founders will leave Mojang to start new projects. He explains in his blog post: “I don’t want to be a symbol, responsible for something huge that I don’t understand, that I don’t want to work on, that keeps coming back to me. I’m not an entrepreneur. I’m not a CEO. I’m a nerdy computer programmer who likes to have opinions on Twitter.”

Some fear that the Swedish game developer’s departure will mean a change to the original game. Mojang disagrees, saying that Minecraft will continue to evolve. “We don’t know specific plans for Minecraft‘s future yet, but we do know that everyone involved wants the community to grow and become even more amazing than it’s ever been,” the company posted. “Stopping players making cool stuff is not in anyone’s interests.”

IDC analyst Lewis Ward agrees, noting that Microsoft knows that it has a good thing going. “I think Microsoft recognizes that Mojang has done a lot of things right,” says Ward. “I think the last thing on Phil Spencer’s and the company’s mind is micro-managing what–as far as I can tell–has been the most successful standalone download in XBLA (Xbox Live Arcade) history.”

Minecraft  is currently the top online game on Xbox Live, with more than two billion hours played on Xbox 360 in the last two years. Now, Microsoft is bringing Minecraft more directly into its gaming fold.

But what does this mean for further innovation in the kids game?

Phil Spencer, head of Xbox and the exec who oversaw the Mojang deal, expressed his thoughts on the matter in his own post. “The Minecraft community is passionate and diverse, ranging across all ages and demographics,” he writes. “We respect the brand and independent spirit that has made Minecraft great, and we’ll carry on the tradition of innovation to move the franchise forward.”

Ward, however, takes this with a grain of salt. “I understand the concern among the existing base of fans that that could happen,” he admits. “But I think Microsoft understands the value of this unique game. It gives a lot of power in terms of creativity and so forth to the customer base. Mojang has a history of soliciting feedback and feeding it into the game development process—I don’t think Microsoft plans to come in and say that’s a bad approach.”

On the other hand Microsoft’s history of buying other studios is inconsistent, notes Ward. “I don’t think it’s a near-term threat at all to Mojang, but Microsoft does have something of a mixed bag in terms of how much the managerial structure has come in and started, for lack of a better phrase, telling people what to do.”

In 2007, Microsoft bought Bungie Studios, creator of the Halo franchise. By the end of that year, the companies announced plans to part ways. Meanwhile Microsoft’s other global gaming franchise Fable, created by Lionhead Studios, was acquired in 2006. The company’s founder Peter Molyneux stuck around for six years after that.

But while past acquisitions have produced stormy relationships, it’s not a certainty with Mojang. With Minecraft, the game’s run of success shows no sign of slowing down, which could be a major factor for Microsoft. “Minecraft is so popular on so many different platforms that it is way past the point of being a one-hit wonder,” says Ward. “It’s been too much of a juggernaut for too long to fall off a cliff tomorrow. We don’t know what Mojang might be working on behind the scenes that could be an Act II.”

As the acquisition is expected to be completed this year or early next, fans will have to wait and see what happens with the game. Its future, notes founder Notch, is now in Microsoft’s—and fans’—hands.

“I love you. All of you. Thank you for turning Minecraft into what it has become, but there are too many of you, and I can’t be responsible for something this big. In one sense, it belongs to Microsoft now. In a much bigger sense, it’s belonged to all of you for a long time, and that will never change,” notes Notch. He ends his post with the parting shot: “It’s not about the money. It’s about my sanity.”

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