The risks (and realities) behind Activision’s $5.9 billion mobile bet

Activision CEO Bobby Kotick is... crushing it. (credit: Aurich vs Activision)

By buying Candy Crush Saga maker King in a $5.9 billion cash and stock deal, gaming mega-publisher Activision Blizzard is placing two related bets. The first bet is that mobile games will continue to grow in importance to the overall game industry and that Activision needs a larger foothold in that industry if it wants to continue to grow. That's a relatively safe bet, all things considered.

The second bet is that King represents a sound investment in the mobile market and that it's well-positioned to be a robust, diversified, and consistent leader in the segment. This bet could turn out to be much riskier.

Get mobile or die trying

After making only token efforts in the mobile gaming space for years, the King acquisition is Activision's acknowledgement that smartphone and tablet gaming is getting too big to be safely ignored by the industry's biggest players. "We believe now is the right time to engage with mobile gaming in a meaningful way," Activision CEO Bobby Kotick said in an earnings call this morning.

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