Good morning dear readers, today we are going to talk about Discord which is about to be sold for $10 billion to Microsoft.

Microsoft Corp. is in talks to acquire Discord Inc., a video game chat community, for over $10 billion, according to people familiar with the matter it is believed that the deal is already done or in the concluding part of deals.

Discord has talked to potential buyers and software giant Microsoft is in the running, but no deal is certain for now, said the people, who asked not to be identified because the discussions are private. Discord is more likely to go public than sell itself, one person said. Representatives for Microsoft and Discord declined to comment. On Monday, VentureBeat reported that Discord was engaged in sales negotiations.

Microsoft’s expansion plans

Microsoft, which last year sought to buy social media app TikTok and held talks to acquire Pinterest Inc. has been buying resources that would provide access to thriving user communities, according to people familiar with the company’s thinking. Microsoft’s Xbox business also expanded the suite of subscription benefits it provides as part of its Game Pass offering. Microsoft shares were up about 1.2 percent in early trading Tuesday.

Discord, based in San Francisco, is best known for its free service that allows gamers to communicate via video, voice and text, and people stuck at home during the pandemic have increasingly used its technology for study groups, dance classes, book clubs and other virtual gatherings. It has more than 100 million monthly active users and has elaborated its communication tools to turn it into a “place to talk” rather than simply a player-centric chat platform.

“The possibility of Microsoft acquiring Discord are many and it makes sense as it continues to reshape its gaming business towards software and services,” said Matthew Kanterman. “There is a great opportunity to bundle Discord’s premium offering, Nitro, into the Game Pass service to get more subscriptions from the last 18 million reported.”

Following the recent $7.5 billion purchase of ZeniMax Media Inc, owner of Bethesda Softworks’ The Elder Scrolls and Doom, an acquisition of Discord would signal the Redmond, D.C.-based software giant’s willingness to continue investing in its video game unit.

“We expect Xbox to stay updated to continue to strengthen the Game Pass value proposition and increase subscriptions,” Kanterman said.

Discord contacted Microsoft to gauge interest and Xbox chief Phil Spencer spoke with the company, according to a person. The company raised $100 million with a $7 billion valuation last year.

Discord sales attempts

Discord has also held discussions with Epic Games Inc. and Inc. in the past, according to two people familiar with the matter. Epic did not immediately respond to requests for comment. Amazon declined to comment.

The sale of Discord for the creators could mean a big step, also because it is not known if when this global pandemic ends the platform will most likely have a decrease in monthly online users since at this time even a small opening leads people to leave, on the other hand there is Microsoft that has smelled the smell of bargain given the exponential increase in users.

Instead for us users it could mean a worsening or improvement in graphics but obviously being Discord free and not collecting personal data, Microsoft will need to earn in another way besides the Nitro service.

This is all, see you in a next article.

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