Could Minecraft Become Microsoft’s Next Halo?

Tech giant expected to buy game maker for $2B

If the rumors are true, Microsoft Corp.'s move to purchase Minecraft could position the popular video game as the next big entertainment franchise.

Several outlets reported that the Redmond, Washington-based tech giant is negotiating a $2 billion deal to buy game producer Mojang, which makes Minecraft as well as Scrolls and Cobalt. The New York Times reported that Microsoft was especially interested because it wanted to make sure the game was available for its devices.

The PC-version of the game sells for $27 and is already available for Xbox at just $20, relatively low considering most console games retail for $60. Right now, with a little under 17 million copies sold, Minecraft doesn't compare to the Call of Duty franchise, which has sold more than 100 million copies.

But Minecraft is frequently one of the most common games featured in gaming-themed online videos, with YouTubers like SkyDoesMinecraft and Captain Sparklez attracting billions of views. With more brands trying to buy native video advertising and pre-roll that is guaranteed to get Gen Z and millennial eyes, it's exactly the kind of gaming content marketers want to get behind.

What makes Minecraft different from most popular titles is that it's a sandbox game, which means users completely create their experience. To play the game, you construct a virtual 3D world using textured cubes. Since the basic landscape is generated differently for each player, every game is unique—and completely up to the players’ whims.

Online streaming video platform Twitch, which specializes in gaming content, said Minecraft videos are consistently in their top five and have even topped its charts on occasion. While the perennial favorites are still videostreams about League of Legends, DoTA (Defense of the Ancients) and Starcraft 2, Minecraft has been one of the fastest growing titles over the last six months. Twitch's first channel to hit a million followers, Syndicate, is dedicated to the game.

Twitch's Minecraft partnership lead Aureylian (who goes by her username for privacy reasons) said part of what makes Minecraft content resonate is that related video content is always original. On the other hand, your typical console games and many PC games tend to have a storyline, so the streaming content follows the same basic path no matter who is behind the controls.

"In Minecraft, literally, you're put in a world where you're allowed to explore, and the world is never the same for two people," she pointed out.

Also, because it doesn't involve violence, Minecraft's typical audience runs the gamut of young teen to middle-aged gamers more than the typical first-person shooter game, which tends to be male teens, Aureylian adds. It's the kind of stuff families can sit at home together and watch.

Because of this, the audience tends to be extremely engaged and more varied in gender and age, Twitch's vp of marketing Matt DiPietro claims. "What advertisers want is great content and a hyper-engaged user. Users on the Twitch platform spend hours at a time leaning forward, chatting with each other and chatting with the broadcaster. It provides an extraordinarily valuable way to engage with those readers, and Minecraft video content is the best example of that experience because it's a very creative experience," he said.   

Just look at one of Microsoft's other titles—Halo—to see how far a game can go. Halo has a Showtime show produced by Steven Spielberg scheduled to be released in 2015 (although admittedly it's been stuck in development limbo for what seems like forever); digital feature films; popularity in gaming competitions; and a staggering variety of merchandise.

With the power of one of the biggest tech brands out there, Minecraft could be the next blockbuster entertainment property. And Microsoft could use the help. It recently reported a $400 million loss on its Xbox One, closed the Xbox TV Studio it hyped during its Newfront presentation and saw its largest round of layoffs in July. The New York Times added that the company still has $86 billion, so the $2 billion deal wouldn't dent the finances that much, considering the potential.