What Minecraft Means to Microsoft

By all accounts, it appears Microsoft is about to purchase the maker of Minecraft – Mojang. This seems like a head scratcher of a deal, and, without knowing the details of the strategy, parts of it are. However, what this deal signifies in my mind is a broader trend for the 800 lb gorillas in our industry to battle for consumers’ time.

For much of Microsoft’s dominance, they did not just command the operating systems for computers but their software, products like Microsoft Office and Internet Explorer, held sway over the computing time of customers. Microsoft owning a large chunk of computing time is, by far, one of the biggest transitions the last decade has brought. Microsoft used to have some of the most popular products in terms of amount of time per day spent using them. Today, that is no longer the case.

This is why, at a high level, what we are observing from companies like Apple, Google, Amazon, and Microsoft is a battle for consumer time. Since consumer time is finite, this is the most important battlefield. This is why usage is one of the most common statistics today to gauge success. It is no longer just about how many customers one has — it is about how much time is spent using the product.

It is through this lens I view Microsoft’s acquisition of Minecraft. Outside of Office, the Xbox is the only ecosystem Microsoft has, outside of commercial products like Office, that gains any real consumer traction in terms of usage. Arguably, the consumer usage of Office products is exceptionally low, and Xbox¬†is their only real traction with mainstream consumers and even that is limited. Minecraft, while primarily a PC game, is also available on Android and iOS. This game is not free but has shown great success in its ability to monetize its game. Beyond just being a healthy business, Minecraft has some incredibly engaged users. A non-public survey I saw data from earlier in the year suggested the average Minecraft gamer plays on average 2 hours per day. Not bad, when time is what is being competed for by the companies at the top of the industry food chain.

If you have played Minecraft, you know it can be addicting. If you have kids who play it, you know this fact even more fully. Minecraft is sort of “LEGO” for the digital generation. I think there are fascinating places Minecraft can go. Education angles perhaps being the most interesting.

Gaming is lucrative. Microsoft knows this as do many others. But a consumer’s time is even more lucrative. As products arise that begin to sustainably take consumer time, expect them to be purchased rather quickly from one of the 800 lb gorillas.

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Ben Bajarin

Ben Bajarin is a Principal Analyst and the head of primary research at Creative Strategies, Inc - An industry analysis, market intelligence and research firm located in Silicon Valley. His primary focus is consumer technology and market trend research and he is responsible for studying over 30 countries. Full Bio

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