Microsoft is said to be in exclusive talks to acquire Discord an online chat platform for $ 10 billion or more, in a deal that could be announced as early as April.
The company has yet to confirm an upcoming deal, but recent comments from executives are helping to shed light on why Microsoft might want a new chat platform. created for gamers – and what was behind its failed bid to get TikTok and reported a one – time interest in Pinterest sculpting.
In short: It’s all about reaching out to content creators and communities.
During Microsoft’s recent Ignite conference, CEO Satya Nadella set out the company’s priorities for the coming years, reiterating points such as the increased need for public confidence in technology and the “explosion” of data – but also using the time to call out tools that can do for “authorized creators and communities everywhere.”
Nadella called for the “democratization of creation,” which means expanding skills, tools, platforms, connections, and collaboration across communities so that “everyone can be created, regardless of build a meaningful world, students work on customization with short format videos, staff experience creating formulas and spreadsheets for developers, writing code, or land experts using local tools to build applications, “he said. e.
In doing so, Nadella publicly published for the first time a dissertation on why Microsoft, which has seen a resurgence in recent years amid a focus on cloud computing and developer technology, would want to get its -into the consumer social networking market after years of largely declining.
Phil Spencer – Microsoft ‘s head of game, and the custodian who would be likely to end up with Discord control if taken through – reiterated Nadella’ s commitment to this strategy in comments to staff at a meeting. hand in March. Microsoft has not responded to a request for comment.
“Satya has really gained traction with content creators as an important part of the future of Microsoft’s platform, and game creators are an important segment of content creators,” Spencer said at the time that according to the audio of the meeting reviewed by Insider, although it did not directly address Discord.
Acquiring Discord gives Microsoft access to an active online community. “After looking at Pinterest and TikTok, it seems that Microsoft is clearly interested in properties that have large and active user communities,” said Morningstar analyst Dan Romanoff.
Microsoft has previously taken over the social space, most recently with GitHub and LinkedIn. Discord would be a consumer-based purchase, following recent megadeals such as its $ 7.5 billion deal to buy publisher ZeniMax games, parent company Bethesda Softworks.
It’s also worth noting that some of Microsoft’s recent moves into the creative space have failed: Microsoft Mixer, a rival to Amazon’s leadership
Twitch
game streaming service, was shut down last year after failing to attract a vibrant ecosystem, despite big money dealing with Tyler “Ninja” Blevins and other major creators.
Nonetheless, Discord could fit into Microsoft’s gaming industry, ultimately powering chat on its Xbox consoles. It could also, in the long run, support other outcomes, such as the increasingly important Teams communication app. And, unlike, Mixer, Discord comes with a huge, attractive fan base all in all.
In fact, Creative Strategies analyst Carolina Milanesi told Insider to Discord share some TikTok-like features of access to a younger, highly engaged and middle-class audience, in which in this case, a conversation that Microsoft can use for its Teams collaboration software. Overall, Discord is highly regarded among gamers and other online communities; Microsoft could transfer some of that knowledge to make Teams more attractive.
“Chatting feels like the part of a collaboration that no one has yet cracked
Slack
, as far as making it attractive, free – flowing and still – streamlined, balancing internal and external connections and synchronous and asynchronous communication, “said Milanesi. Slack, which recently acquired Salesforce for $ 27.7 billion, is Microsoft ‘s main competitor in the conversation space.
Adding teams is important as the company tries to elevate the co-op app higher than competitors like Slack and
Glossary
. Jared Spataro, corporate vice president of a series of Microsoft 365 business applications involving Teams, said during town hall recently that the strategy behind Teams is to make it the only app combines “meet, chat, call, collaborate in one app.”
“Strategically, we are always looking as a company for what I call platform inflection points,” Spataro said, according to the hearing of the meeting reviewed by Insider. “For example, I would carry a flip phone, an MP3 player, and a camera all in my pocket and then there was an inflection area where all of these things came into the smartphone. We see a very similar opportunity right now.”
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