Sony Group Corp. shares fell 13% in Tokyo on Wednesday, their biggest drop since October 2008, after PlayStation rival Microsoft Corp. announced a $69 billion deal to acquire games publisher Activision Blizzard Inc.
The blockbuster acquisition escalates Microsoft’s spending spree to secure intellectual property assets for its Xbox Game Pass service, wiping $20 billion off Sony’s valuation in a day. The push to attract paying subscribers with an overwhelming portfolio of games challenges Sony’s traditional console business model that relies on high-profile exclusive titles and hardware sales. Games and network services account for about 30% of Sony revenue.
Microsoft announced Tuesday that it has more than 25 million Game Pass subscribers and “will offer as many Activision Blizzard games as