Microsoft works hard to acquire new businesses and introduce fresh products to the market. Microsoft has been rapidly acquiring new businesses, without a question. In 2023, the enterprise software company intends to buy Netflix.
Microsoft is one of the world’s leading providers of educational technology. Microsoft is a multinational American technology company that makes consumer devices, software for computers, personal computers, and related services.
It is crucial to note that Netflix is an American over-the-top subscription streaming service in this sentence. Its headquarters are in Los Gatos, California.
Netflix wants to amuse everyone in the world. No matter where you live, whatever your preferences. Best-in-class TV shows, documentaries, and movies are accessible through it.
Additionally, it offers a huge selection of anime and TV episodes that have won numerous awards. The first step in Microsoft’s acquisitions, though, was the $2.5 billion purchase of the well-known computer game Mine Craft.
Later, Microsoft paid $26 billion for LinkedIn and $20 billion for Nuance, a manufacturer of speech recognition and artificial intelligence. In addition, Activision Blizzard was the main target with a market cap of $69 billion.
On the other hand, Microsoft is in a legal battle with American Trust Regulators over the purchase of the Call of Duty developer.
Because it now shares a building with the Xbox game system, it has given rise to regulatory worries about market domination.
Owning Netflix will still be a smart strategic choice and make it easier to sell in Brussels or Washington, even if microsoft loses the video game industry due to market competition.
Additionally, both businesses hold a dominant position in the market. For the new ad-supported subscription service, Netflix selected Microsoft as its advertising partner, Brad Smith. In a similar vein, the president of Microsoft serves on the Netflix board.
Microsoft wants its video game Streaming services to be accessible on a variety of devices, which is the deal’s primary goal.
Netflix, on the other hand, has a fantastic and comprehensive gaming package. Spry Fox, a developer, was acquired by Reed Hastings, one of the company’s co-leaders, to serve as its sixth studio.
If Microsoft joined its empire, the goals of the merger would be accelerated.
The idea of a package that mixes streaming TV with video games is, however, pretty straightforward. In actuality, Microsoft’s market worth is 13 times greater than Netflix’s.
As of December 1, Microsoft, a titan of the tech industry, has access to up to $1.8 trillion in cash. If the Netflix company were to be valued at a 30% premium, it would be worth close to $190 billion. It can be difficult to identify major cost savings, though.
Analysts predict that Netflix will make a significant return on investments in 2024 that will be close to 50% of its 8%weighted average capital cost after paying taxes on its $8 billion operational profit.