Microsoft (MSFT) Inks Xbox Deal With Boosteroid Cloud Service

Microsoft MSFT recently announced a 10-year agreement with Boosteroid to bring Xbox games to the latter’s cloud gaming platform. As part of this deal, Microsoft will enable the cloud company to stream Activision Blizzard ATVI games, including Call of Duty.

Boosteroid has 4 million users globally and is available in the United States, Ukraine, the U.K. and across the European Union.

It offers cloud gaming services via the browser and dedicated apps, including on Windows, Linux, Android, Android TV and MacOS. It has also announced plans to offer additional cloud gaming services through Mac, Chromebooks, Android set-top boxes and LG TVs.

While Boosteroid doesn’t disclose the hardware specifications of its servers, the company promises a resolution of 1080p at 60 frames per second. The service costs €9.89 per month or €89.99 per year ($10.61 and $96.57 at today’s exchange rate).

It is to be noted that Microsoft’s deal with Boosteroid is conditional and it will materialize after Microsoft’s acquisition of Activision Blizzard closes.

Microsoft Corporation Price and Consensus

Microsoft Corporation Price and Consensus

Microsoft Corporation price-consensus-chart | Microsoft Corporation Quote

Microsoft Racks Up Gaming Deals to Recover Declining Sales

In second-quarter fiscal 2023, Microsoft Gaming revenues declined 13% and 9% at cc. Xbox hardware revenues decreased 13% (down 9% at cc). Xbox content and services revenues decreased 12% (down 8% at cc) due to a decline in first-party content.

Last week, Microsoft assured fans and players that the price for the Xbox Game Pass subscription service will not increase if the merger is successful, as Microsoft officials stated that increasing the price of this subscription would be counter-productive.

Microsoft also stated that by keeping the Game Pass prices the same, Call of Duty players are more likely to stay subscribed longer rather than just joining Game Pass each time a new game in the series is released.

This is Microsoft’s third deal with other gaming platforms as the company hopes to encourage the U.K. and European regulators to approve its $68.7 billion bid to buy Activision Blizzard. In particular, European regulators will take a decision on whether to clear or block the acquisition by Apr 11, 2023.

In recent months, Microsoft signed similar agreements with Nintendo, Nvidia NVDA and Steam as it battles stiff opposition from Sony SONY, which makes the rival PlayStation console and fears losing access to Call of Duty and Activision's other hit games.

Boosteroid is similar to Nvidia in which gamers can stream titles they already own. Microsoft claims that when combined with other partnerships with Nvidia and Nintendo, the popular franchises, such as Call of Duty will surpass more than 150 million additional players.

The partnerships will also make games built by Xbox Game Studios, Bethesda and Activision Blizzard playable on multiple cloud gaming services and subscriptions.

Microsoft recently offered Sony a 10-year, legally enforceable contract to make each new Call of Duty game available on PlayStation the same day it comes to Xbox – with full content and feature parity. MSFT currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Microsoft confirmed that it has also offered Sony the option to put future Call of Duty games on its PlayStation Plus subscription service on day one, although its rival alleged the offer could be reliant on unsustainable licensing costs, which would force it to raise prices.

The company also said that it is willing to pay a third-party agency to oversee its compliance with any agreed behavioral remedies.

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