Microsoft confirmed Monday that, after days of speculation, it has cut a $2.5 billion deal for Mojang -- the video game studio responsible for the mega-hit, Minecraft. If the only part of that sentence that made sense to you was "Microsoft" and "$2.5 billion," here's a quick primer on Minecraft and why this latest news is such a big deal.
What is Minecraft?
Minecraft is a video game. It was developed by Mojang -- specifically by Mojang founder Markus "Notch" Persson -- and first released in 2009. Minecraft is what's known as a "sandbox" game, or one that lets players pretty much have their own run of the game's world, without specific objectives or, in Minecraft's case, even a plot. Instead, the game lets users free-build whatever they want to with blocks of material they mine from the ground. Players have made everything from working computers to full-scale models of the "Lord of the Rings" city Minas Tirith by painstakingly laying one block on top of another -- a bit like virtual Legos. The only catch is that at night, or in the dark, there are all manner of monsters who are out to get you and, occasionally, destroy your hard work.
Why did Mojang agree to sell?
With such a dedicated community, it may be hard to understand why Mojang would sell -- rumors of the deal certainly did not sit well with the game's biggest fans. Even before the deal was confirmed, plenty of fans were accusing Mojang and Persson of selling out.
In an official company blog post, Mojang's "Chief Word Officer" Owen Hill wrote that the game had simply expanded beyond the independent developer's ability to handle it."Minecraft has grown from a simple game to a project of monumental significance," Hill wrote. "Though we're massively proud of what Minecraft has become, it was never Notch's intention for it to get this big." Hill said in the blog post that the fate of other Mojang projects is still up in the air.
Microsoft was an attractive partner, Hill said, because it has the resources to continue letting the game grow. "We're confident that Minecraft will continue to grow in an awesome way," Hill said in the post.
Persson himself echoed that sentiment. "It's not about the money. It's about my sanity," Persson wrote on his personal Web site, in a post explaining his decision to sell Mojang and leave the company along with his fellow co-founders Carl Manneh and Jakob Porser.
Why did Microsoft buy it?
This is a slightly tougher question. While we've seen other big video game deals this year -- namely Facebook's $1 billion buy of Oculus and Amazon's purchase of Twitch for nearly that much -- those purchases were for platforms with a lot of potential, rather than just a single game.
But, as IDC analyst Al Hilwa said in a note, Minecraft can strengthen Microsoft's hand in providing a unique portfolio of services to users as it competes with the likes of Google, Apple and Amazon, whose chief executive, Jeffrey Bezos, also owns The Washington Post. Microsoft doesn't have something as strong as Google's search, Amazon's Prime content or Apple's iTunes store, and therefore needs to pick up more services.
"Microsoft has Skype and Office, but needs to invest further to strengthen its consumer services assets to attract support to its platforms," Hilwa said. It doesn't hurt that gaming is a big part of Microsoft's success; its Xbox One console may lag behind Sony's PlayStation 4 in sales, but that division still brought in $1.44 billion in the company's last quarter.