The Redmond, Washington-based software giant today announced plans to acquire gaming firm Fasa Interactive Technologies.
The financial terms of the acquisition were not disclosed.
Analysts said that Microsoft's acquisition of Fasa Interactive is part of its goal of gaining an even stronger foothold in the "edutainment" market--software aimed at the education and entertainment market.
"[The acquisition] is part of the company's overall strategy of having its software in every household appliance in the long-run," said Brian Goodstadt, an analyst at S&P Equity Group. "It is Microsoft wanting to be seen by every eyeball."
Goodstadt noted that in 1997 Microsoft held a 6 percent share in the "edutainment" market.
Retails sales of video games were about $5.2 billion in 1997, and are growing at a 30 to 40 percent pace each year.
"[The gaming market] might be worth about $6 billion to $7 billion today," said Goodstadt.
Analysts pointed out that hardware prices, both for personal computers and dedicated video game machines, have been falling, helping the gaming industry gain ground at strong clip.
As a result of the acquisition, Microsoft gains "exclusive and perpetual electronic rights" to the BattleTech universe of stories, games, and characters, including "MechWarrior," and its recent real-time strategy extension, "MechCommander."
"MechWarrior 2" and its related add-ons have accounted for more than $70 million in sales, according to Microsoft.
Late last year, Redmond released three new gaming add-ons, hoping that its new force-feedback gaming controllers will offer a better gaming experience that more closely replicates the physical forces simulated onscreen.
"The acquisition of Fasa Interactive reflects our commitment to growing our business with a smaller portfolio of top-quality games," Ed Fries, general manager of Microsoft's games group, said in a statement.
The company said that the MechWarrior franchise "is one of the best-selling series of PC games in history."
Fasa Interactive's development staff will be integrated into Microsoft's product development teams in Redmond.
Jordan Weisman, chief creative officer of Fasa Interactive and cocreator of the BattleTech universe has also joined Microsoft, where he will guide the growth of the BattleTech-based franchises.
In related news, leading interactive games publisher Hasbro Interactive announced today that it will introduce games that will run on Microsoft's Windows CE operating system.
The company will launch four games this year, starting with Windows CE versions of Hasbro Interactive's best-selling flagship titles Monopoly and Scrabble to be released in March. The games will sell for approximately $30 in stores.