Microsoft is building an Xbox mobile gaming store to take on Apple and Google

IbizaPocholo

NeoGAFs Kent Brockman

The CMA is currently investigating the $68.7 billion Activision Blizzard acquisition and has asked Microsoft for context. In its filings, Microsoft says a big motivation for the purchase is to help build out its mobile gaming presence. Its plans for this space apparently include creating an Xbox mobile gaming platform and store. Here’s what the company says in the filings:

The transaction will improve Microsoft’s ability to create a next generation game store which operates across a range of devices, including mobile as a result of the addition of Activision Blizzard’s content. Building on Activision Blizzard’s existing communities of gamers, Xbox will seek to scale the Xbox Store to mobile, attracting gamers to a new Xbox Mobile Platform. Shifting consumers away from the Google Play Store and App Store on mobile devices will, however, require a major shift in consumer behavior. Microsoft hopes that by offering well-known and popular content, gamers will be more inclined to try something new.
Call of Duty: Mobile and Candy Crush Saga are two hugely popular mobile games published by Activision and King, respectively, and Microsoft could leverage these titles to help build out a game store to rival Google Play and the App Store. Given Apple’s policies blocking third-party app stores on iOS, it’s difficult to imagine Microsoft competing on iPhones anytime soon. But that’s clearly not stopping it from envisioning an Xbox mobile app store.

Microsoft’s acknowledgment of a mobile gaming push comes as the company increasingly positions Xbox Cloud Gaming as an option for mobile gaming on emerging handhelds. Microsoft was quick to support Xbox Cloud Gaming on Valve’s Steam Deck, followed by a partnership with Logitech and Razer for their cloud gaming-focused handhelds. That means a push into mobile gaming could happen on multiple fronts — not just on phones and tablets.

Beyond hardware, there’s a lot of revenue at stake here, too. Games are some of the most popular downloads on mobile and drive in-app purchases on app stores. Microsoft clearly wants a piece of that pie. Look at how the company describes the opportunity:
The transaction gives Microsoft a meaningful presence in mobile gaming. Mobile gaming revenues from the King division and titles such as Call of Duty: Mobile, as well as ancillary revenue, represented more than half of Activision Blizzard’s ... revenues in the first half of 2022. Mobile customers account for around three-quarters of its MAU. Microsoft currently has no meaningful presence in mobile gaming and the Transaction will bring much needed expertise in mobile game development, marketing and advertising. Activision Blizzard will be able to contribute its learnings from developing and publishing mobile games to Xbox gaming studios.
However, the CMA has barely discussed the potential for Microsoft’s entrance into mobile gaming as part of its investigation and is instead largely focusing on console gaming, which Microsoft argues is an increasingly smaller part of the overall market. In a graph posted at Microsoft’s Activision Blizzard acquisition site, the company depicts the entire gaming market as worth $165 billion in 2020, with consoles making up $33 billion (20 percent), PCs at $40 billion (24 percent), and mobile gaming at $85 billion (51 percent).
Gaming market revenue.

Building a successful rival to the Google Play Store or App Store would be a huge challenge, though, and Microsoft will need to woo third-party developers if it hopes to make inroads.

The company seems to be laying the groundwork here by committing to a set of principles that would allow developers to freely run their own app stores on its Xbox mobile platform and offer their own payment systems to process in-app purchases. That’s a benefit Apple certainly doesn’t offer. (These commitments don’t fully extend to Xbox consoles yet, but Microsoft said earlier this year it’s “committed to closing the gap on the remaining principles over time.”)

Microsoft says these same principles will also apply to the future Xbox mobile store, which could be enough to lure developers onto the platform. One company that might be particularly interested is Epic Games, which has allied itself with Microsoft in the past few years in the fight against Apple’s App Store policies.
 
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12Dannu123

Member
The question is whether this Xbox 'mobile gaming store' is needs natively supported games or does it rely on Cloud gaming. If its native games, then it'll be quite difficult to compete against Google and Apple. If it's cloud-based, then there's a chance.
 

01011001

Gold Member
The question is whether this Xbox 'mobile gaming store' is needs natively supported games or does it rely on Cloud gaming. If its native games, then it'll be quite difficult to compete against Google and Apple. If it's cloud-based, then there's a chance.

there are a couple of pretty popular stores on Android... of course iOS is a different beast since Apple are a bunch of dicks...

I have 3 third party stores installed on my phone right now. I have the Samsung Store (since I have a Samsung), Qoo App and the Amazon Store.
Qoo App is really great to get some Japanese only games, or some games earlier than the western release.
Amazon and Samsung have some stuff that's not in the Play Store or sometimes freebies.

Microsoft also has a very popular Android Launcher (more than 50 million installs... which I use too), and they could advertise their storefront through their already popular Launcher or even just Edge, so they got ways to bring people onto their store.
 
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ShadowLag

Member
Surprised to see that PC has higher revenue than console currently. Also worth noting that PC and console are both growing, and the two of them combined are very close to matching mobile. Seems like being on both PC and console is the key, not mobile where you're just a drop in the bucket from day 1...
 

reksveks

Member
Surprised to see that PC has higher revenue than console currently. Also worth noting that PC and console are both growing, and the two of them combined are very close to matching mobile. Seems like being on both PC and console is the key, not mobile where you're just a drop in the bucket from day 1...
All devices are growing generally, mobile will be most impacted by the recession but that might be partially due to the lack of mobile hw revenue that gets accounted for.

Source that there is much of a difference in revenue distribution between console, pc and mobile? I can see PC being very similar to mobile.
 

reksveks

Member
I get the argument, not sure the CMA is going to buy but who knows.

I do think that they probably still need the DMA or OAMA to be passed for this to really happen.
 

Jaybe

Member
Wonder if this is a serious effort by Microsoft or something half-baked to just throw at Apple’s walled garden and launch some lawsuits to try and take it down when Apple blocks or messes with it. They seem to be very cooperative with Epic/Fortnite in trying to dismantle Apple’s App Store stranglehold.
 
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ShadowLag

Member
All devices are growing generally, mobile will be most impacted by the recession but that might be partially due to the lack of mobile hw revenue that gets accounted for.

Source that there is much of a difference in revenue distribution between console, pc and mobile? I can see PC being very similar to mobile.

I'm just conjecturing purely on the player count and titles released, which are *way* higher on mobile. It could be like another Zune for MS. The Google Play store alone has 400,000+ games on it, while the Apple store has 900,000+.

Although, if the Actiblizz deal goes through, MS will have some very recognizable titles out of the gate, which is what they seem to be betting on.
 

reksveks

Member
I'm just conjecturing purely on the player count and titles released, which are *way* higher on mobile. It could be like another Zune for MS. The Google Play store alone has 400,000+ games on it, while the Apple store has 900,000+.

Although, if the Actiblizz deal goes through, MS will have some very recognizable titles out of the gate, which is what they seem to be betting on.
Yeah think the distribution is probably more important, the long tail on mobile is definitely much longer but I think the 90% of revenue maybe distributed in the same number of games as on other platforms. Candy Crush, Diablo Immortal and COD warzone/mobile will be very big especially in terms of MAU.
 

DaGwaphics

Member
The answer is just what everyone wants to hear, streaming. :messenger_tears_of_joy:

MS could put the entire Xbox store in a browser window, they could also have mobile oriented games with native touch controls (not controller overlays) and the like (probably alongside a version for console/PC with cursor based or traditional controls).

Bam, new mobile game store and you don't even need to worry about your storage space (we won't talk about your data usage :messenger_winking_tongue: )

Seriously though, MS will have some heavy hitters on mobile after this deal, they could do a free-standing mobile store for those. Not sure how much traction it would get, but maybe they could incentivize it in some way for players.
 

GhostOfTsu

Member
Nobody is asking for this. Candy Crush and COD mobile is doing fine on iOS and Android without MS store.

Create your own mobile game and launch it exclusively on your shit store if you want to compete.
 

Lasha

Member
The question is whether this Xbox 'mobile gaming store' is needs natively supported games or does it rely on Cloud gaming. If its native games, then it'll be quite difficult to compete against Google and Apple. If it's cloud-based, then there's a chance.


Kings games, COD mobile, get Fortnite by offering a favorable cut to Epic and you have a solid foundation for a store. Gamepass/xcliud would be icing.
 

CeeJay

Member
The question is whether this Xbox 'mobile gaming store' is needs natively supported games or does it rely on Cloud gaming. If its native games, then it'll be quite difficult to compete against Google and Apple. If it's cloud-based, then there's a chance.
It'll probably be a mixture, native where the hardware can support it (King games) and streaming if not (Xcloud games). With the tech they have for play anywhere and smart delivery with Xbox it could also work for mobile. Their tech could determine your hardware spec and then seamlessly either launch native or launch an Xcloud session for the game that you've chosen. The USP for this would give them a vast catalogue of games potentially the biggest across all of gaming and developers no matter what platform they are developing for could deploy their game to the store. It could potentially become a truly hardware agnostic store if the pieces fall into place.

All the talk is about taking COD away from Playstation but no one is talking about what happens if an MS owned ActiBlizz takes Candy Crush away from Apple or Play Store. Most probably because no gamers really care about it. Candy Crush however makes more money than COD, has more active users and is the most popular mobile game, has been for quite some time.
 

Cyberpunkd

Gold Member
All the talk is about taking COD away from Playstation but no one is talking about what happens if an MS owned ActiBlizz takes Candy Crush away from Apple or Play Store. Most probably because no gamers really care about it. Candy Crush however makes more money than COD, has more active users and is the most popular mobile game, has been for quite some time.
They will not take Candy Crush away from mobile. Apple does not allow it, too much hassle on Android.
 

Goalus

Member
So in reality the acquisition will lead to more healthy competition and attack the Apple/Google duopoly. It's a good thing that MS are brave enough to go on this adventure and make the planet worth living. Whoever is against this, needs to be cancelled. I hope the regulators know that.
 
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So in reality the acquisition will lead to more healthy competition and attack the Apple/Google duopoly. It's a good thing that MS are brave enough to go on this adventure and make the planet worth living. Whoever is against this, needs to be cancelled. I hope the regulators know that.
But think about Son… I mean the gamers!

On a side note, this angle will probably help MS case a lot since UK regulators HATE google and Apple monopoly with a passion.
 
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