I can’t see this being a good thing. When you spend 2.5 billion on something, it means you’re expecting to extract 3-4 billion plus out of it.
Say hello to downloadable content, or Minecraft 8 with a ‘cool’ new metro interface etc.
Not like notch was doing that franchise any favours with his disinterest and lack of re-investment. I’m optimistic about the change up.
How was Minecraft worth that much money?
Because 20 million kids play it and don’t hesitate to buy new skins, characters, and mash-up packs for a couple bucks each.
Microsoft is buying Mojang, not Minecraft. The two are not synonymous although it sometimes feels like it. I will be hopeful that Microsoft is looking to add the skills and intuitions of the developers at Mojang to its toolbox but is smart enough to know to leave Minecraft itself relatively alone. 1.8, the newest release, is a complete retooling and optimization of the base code. I have to believe they wouldn’t have bothered to do that if they thought Microsoft was going to revamp everything anyway. Agreed that Notch’s leaving means nothing re: minecraft development. He hasn’t been involved with that for years.
Man. So much money. Hard to even fathom what that kind of money does to ones life. Guess he and Dr. Dre can get together and chat about it.
I will say though that for the amount of money that MS spent on Mojang they could have funded the development of 10+ new AAA IPs. Has this huge of an acquisition ever paid off for the buying company? How in the world will they make that money back, let alone profit.
I suppose part of its value will come from a title screen on umpteen million devices that now reads “Minecraft by Microsoft” or something of the sort?
Mojang made $129 million in profit in 2013. 20 times current profit is a relatively sane price for a company.
I’m not sure what the numbers look like.
It’s still selling, and apparently more on consoles/mobile than on PC now, PC has to be approaching saturation at this point. Revamping/re-optimizing core code is probably more of a money sink than something that’s going to drive more sales.
“Buying Mojang” vs “Buying Minecraft” is largely irrelevant. Nobody’s paying big bucks for Scrolls.
I suppose “Minecraft 2” is a possibility, but I can’t see how they’d do it other than just stopping Minecraft at 1.8 or 1.9 or whatever and just selling a revised version. You’ll get a lot of sales, sure, but probably really piss off the community.
Minecraft is selling a lot of merchandise nowadays. No clue what cut Mojang gets, but I bet Microsoft can get better deals. And they can probably do a better job of organizing Minecon (brain-damaged monkeys can probably do a better job of organizing Minecon…)
Servers may be their best shot at continuous revenue streams. There’s been the big argument about the EULA and pay-to-win minigame servers and such, Microsoft’s in a much better situation to be able to get that under control and monetize it for themselves.
And, of course, they could pull a Nintendo and start claiming YouTube revenue. Not a good idea community-wise, but it would bring in a good chunk of cash.
Minecraft DLC already exists and has for some time.
Based on an economic model for a widget factory, maybe. Minecraft has already sold most of the copies it’s ever going to sell. It’s not as if MS is going to sell as many copies of Minecraft as they did in 2012 for the next 20 years to break even on their money (ignoring inflation/time value of money/etc)
I have no idea how you could take a game and expect to make 2.5b on it. Does the entire call of duty series even have 2.5 billion in profit over a decade? Maybe World of Warcraft touches those numbers, but that was both a phoneminal hit, and a monthly sub.
I can see no viable path for Microsoft not to lose a shitload of money on this.
In game sales with little to no oversight or double-checking options for the purchase. 
Minecraft was just released for the PS4 and Xbox One with a Vita version incoming. And don’t forget, they bought Mojang too. Developers can develop more than one game. I don’t have any numbers handy, but I’m sure I can meet your request for a series with $2.5 billion in profits.
My guess is that Microsoft is going to revise the Xbox version to include more of the PC functionalities, most importantly the ability to play with other people on servers. Which of course will require buying an Xbox Live Gold account. And the ability for players to buy additional items like mods and whatever else my 10-year-old seems to be spending most of his allowance on. Seems like Microsoft could spin a pretty good revenue stream out of that.
“It looks like you’re building an outhouse. Would you like help?”
OK, here we go. The Call of Duty franchise has sold roughly 120,000,000 copies. Figure $50 per copy and you’ve got a $6 billion total. Subtract development costs for more than a dozen games and you’ve got over $4 billion in profit, at minimum. And that’s before downloadable content and other merchandise.
The amount a publisher makes on a $60 retail console sale is more like $25 than $50, and assuming all copies sold at full or near full price is optimistic. I think 2.5 billion is actually a decent rough guess as to how much profit the series has done over a decade. Development costs and marketing are in the tens of millions per game. They also have to pay ~$10-12 per copy to Microsoft or Sony on consoles.
Microsoft has the advantage of being a first party publisher and being able to keep pretty much the entirety of digital sales on the xbox systems, but the disadvantages are obviously staggering. People buy the latest iteration of CoD every year, whereas minecraft is a $5-20 game depending on platform that pretty much everyone in the world already owns. Most of its markets are near saturation. So you have to come up with a new monetization scheme, and it seems implausible that $2 skins are going to make you 2.5 billion dollars. And obviously you’d have to actually make considerably more than 2.5 billion - given the opportunity cost, inflation, and the need to turn an actual profit.
Maybe if they bought Minecraft up in the earliest part of its lifecycle I could see it reaching 2.5 billion after all the sales and heavy monetization, but they’re buying it near market saturation. I’m not sure what monetization option they could go with that would hope to earn 3+ billion without alienating the community.
I think if they’re looking to Minecraft to recoup this investment rather than the studio, they’re going to have to do something or a bunch of somethings that will alienate the community.
Except, they’re not. Minecraft is still at the top of the iOS and Android sales charts week after week. And the disc edition of the console version has been in the monthly top ten since it was released (it was #3 last month). And the PS4 and Xbox One editions were just released. And WB is making a Minecraft movie. And Minecraft toys/shirts/etc still sell like crazy.
It’s a tad ridiculous to spend $2.5 billion on a studio with one hit to their name, but it’s not as crazy as you’d think.
Microsoft is doing a lot more than buying a game. They’re buying its entire installed userbase. It’ll be interesting to see what they intend to do with it, but I imagine it’ll be a bit more than just attempting to further monetize the existing product.