10 Companies Microsoft Could Buy to Create Its Enterprise Metaverse
- Recent deals like the $ 68.7 billion Activision acquisition are key to Microsoft’s metaverse plans.
- With many company valuations on the decline, Microsoft has the opportunity to buy other firms, too.
- Here are 10 companies analysts said Microsoft could buy to jumpstart its enterprise metaverse.
The future of the metaverse isn’t yet clear, but tech giants are already trying to lay claim to it since Meta brought the term into popularity late last year.
Microsoft, in particular, has the “enterprise metaverse” in its sights. CEO Satya Nadella described it as the “new layer of the infrastructure stack” tailored to the future of business and the workplace, rather than consumer experiences like gaming.
Analysts point to Microsoft’s planned $ 68.7 billion acquisition of video game publisher Activision Blizzard as the first step in a longer play for revolutionizing the way companies work. The Activision acquisition “tipped the hand” for Microsoft to go big on the metaverse, WedBush analyst Dan Ives told Insider. And Microsoft itself called it an investment in the “building blocks for the metaverse.”
“The way we see this is an opportunity in a very classic Microsoft sense,” Nadella said during the company’s most recent earnings call. “Both at the platform infrastructure level and in the application level.”
But Microsoft’s metaverse strategy has so far been mired by internal conflicts and the cancelation of major metaverse products like the HoloLens 3 augmented reality headset. Still, the company says the metaverse remains a top priority, and is moving forward with its plans for the enterprise.
And with its background building software products and cloud services for companies, Futurum analyst Dan Newman told Insider that there are few who could match Microsoft’s headstart.
“I expect real competition from Meta, Alphabet, even Amazon down the line in different parts of the metaverse,” he said. “When it comes to the enterprise space, it would be very difficult to compel the market that there’s anyone better positioned than Microsoft.”
Analysts say one way Microsoft could accelerate its metaverse vision is through acquisitions - whether big and splashy like Activision, or smaller firms tackling parts of the metaverse like 3D mapping that allows for digital visualizations.
And the timing could be just right: 2022 is shaping up to be a year of sizable M&A from the tech giants and private equity.
Microsoft is especially eager to buy more companies, though any large deals would likely take place in the latter half of the year as it’s still closing its $ 19.7 billion purchase of AI firm Nuance, RBC analysts wrote in a January research note. But recent reports indicated Microsoft is in talks to buy $ 4.2 billion cybersecurity firm Manidant, suggesting that the tech giant still has an appetite for deals in the meantime.