Earlier this week, VentureBeat had learned that Discord was potentially looking to finalize an acquisition sale of the company, though no official company was named. However, the report did mention that sources familiar with the acquisition were exploring sale options before a $10 billion offer was made. Initially, that offer was left to speculation by VentureBeat, but it seems Bloomberg affirmed VentureBeat’s report and affirmed that the huge offer was indeed made by Microsoft. That’s a significant offer, even more than the offer the company had previously made with Xbox to acquire Bethesda/Zenimax, but Discord has declined acquisition offers in past bids.
A similar situation occurred for Discord in 2018, when Discord and Qatalyst Partners were coordinating for a potential acquisition. Though no specific bidders were ever named, Discord’s CEO Jason Citron had allegedly declined offers that would’ve forced the platform to engage in things Discord management didn’t want to do, like advertising. However, things could be very different with Microsoft, assuming the company were to take a similar approach with the Xbox brand. Granted, unlike the Bethesda/ZeniMax acquisition, usage of Discord would not be exclusive to gaming consoles. Discord has very much become a universal platform, not just for gaming.
Frankly, at this point there’s a very likely method of acquisition that Microsoft could employ with Discord, assuming the sale is made final. The most likely scenario with Discord would be for Microsoft to take the seemingly “hands-off” approach, similar to what the Xbox brand has been doing with game development studio acquisitions. Unlike Ninja Theory, a game development studio small enough that Microsoft’s funding was instrumental to its future success, Discord is an immensely popular digital community platform. However, that doesn’t mean a Microsoft acquisition would inherently change the future of Discord’s development or availability inherently.
Rather, it would make sense for Microsoft to take an independent approach, similar to its other high profile platform acquisitions like LinkedIn. Former LinkedIn CEO Jeff Weiner had mentioned that Microsoft’s CEO Satya Nadella expressed a desire for the “independence” of LinkedIn when the employment platform was acquired in 2016. Microsoft’s resources were simply used to amplify the social media platform, despite spending an even larger sum ($26.2 billion) to acquire LinkedIn. A similar approach would undoubtedly be used to establish a partnership with Discord under the Microsoft umbrella, especially with all the good will Xbox has cultivated in the last few years.
Of course, many were quick to point out any potential downsides to a Microsoft acquisition of Discord. Many fans and users of Discord have expressed a desire for the community platform to remain gaming platform agnostic, and that a Microsoft sale could potentially interfere with that. Players have often used Discord as a sort-of middle-man for cross-platform multiplayer: For example, a group of three friends playing Rocket League on three different platforms would be able to use Discord for voice chat via PC or even on mobile. Also worth noting; Xbox has an exclusive Discord app integration, but doesn’t support cross-chat with PC and is fairly limited.
There’s also many fans who have expressed a concern with the way Microsoft has handled acquisitions of popular programs in the past. Many have pointed to examples like Skype and Microsoft Teams as programs that Microsoft could potentially use to interfere with Discord’s functionality in some way. Obviously this would be a very extreme case, and is ultimately unlikely, but many figure that Microsoft will somehow find a way to hinder Discord’s development as a platform. As for how, some have pointed out integrations with Teams that could create unnecessary complications with how Discord exists currently, though it’s unclear how that’d even be possible.
For as much as this potential acquisition has been discussed, VentureBeat’s report notes it may be more likely for Discord to decline any acquisition deal again. Regardless of how much “independence” Microsoft may encourage for Discord’s development, Discord may instead opt to go public in the stock market instead. According to a source familiar with Discord’s financial considerations, “the company is doing really well” and could very well decide to take the IPO route instead of merging. Obviously, there are downsides to making an IPO, especially since Discord has not turned profitable yet according to the Wall Street Journal, despite record earnings.
Regardless, in any likely scenario where Discord either becomes a publicly traded company, or is acquired by Microsoft, it’s certainly not going anywhere. In any scenario, the overall functionality of Discord has no reason to change, and would only be enhanced over time. The only thing that could potentially happen with a Microsoft acquisition, other than greater financial backing/support, would be additional integration with other Microsoft or Xbox services. Xbox players could theoretically receive cross-platform party chat, or a more fully-featured Discord app could be developed for Xbox. A Microsoft acquisition of Discord wouldn’t be so bad for Xbox players.
Source: VentureBeat
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