Microsoft is in talks to buy Discord for more than $10 billion, according to sources. The tech giant and the popular platform company have yet to reach an agreement, and representatives from both sides declined to comment on the matter. However, VentureBeat reported on March 22 that Discord was in talks with several potential buyers, including Microsoft.
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San Francisco-based Discord is known for its free service that allows gamers to communicate via video, voice calls and messages. The platform’s users have grown significantly during the COVID-19 pandemic as people look for solutions for communication as well as entertainment. For example, many are using the platform for study groups, dance classes, book clubs and other virtual gatherings. Discord has more than 100 million monthly active users and is refining its communication tools to be a “place to talk” rather than just a chat platform focused on gamers.
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Microsoft, which last year tried to buy TikTok and has held talks to acquire Pinterest, is buying assets that will provide access to large user communities. In addition, Microsoft's Xbox business is expanding the suite of subscription benefits it offers as part of its Game Pass offering.
Matthew Kanterman, an analyst at Bloomberg Intelligence, said: “It is very likely that Microsoft will acquire Discord as it continues to reshape its gaming business more towards software and services.”
Following Microsoft's recent purchase of ZeniMax Media (owner of "Bethesda Softworks", publisher of the video game series "The Elder Scrolls" and "Doom") for $7.5 billion, the acquisition of Discord would indicate the Washington-based tech giant's willingness to continue investing in video games.
Discord has reached out to Microsoft to gauge interest, and Xbox chief Phil Spencer has reportedly spoken to the company. The company also raised $100 million at a $7 billion valuation last year, according to Pitchbook.
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Sources also report that Discord has held discussions with Epic Games and Amazon in the past. However, neither Epic Games nor Amazon have responded to these rumors so far.
