According to people familiar with the situation, Discord, a prominent gaming social media site, has held talks with Microsoft about a $10 billion offer.
The talks were preliminary, and no agreement is imminent, according to one of the participants, who did not want to be named because the discussions are private. The talks come as video gaming has grown in popularity as a result of the pandemic, and Microsoft, one of the world’s most successful tech companies, has bolstered its gaming business through acquisitions.
Many of Microsoft’s recent acquisitions have focused on online communities, such as LinkedIn, GitHub, and the game developer responsible for Minecraft. Microsoft was in negotiations to buy the video app TikTok in what would have been a blockbuster deal last summer, but the talks fell through. Microsoft also paid $7.5 billion in September for ZeniMax Media, the parent company of many major gaming studios.
Discord, which has over 100 million monthly active users, has become extremely common during the pandemic, with people using it to communicate with one another while playing games. According to another person familiar with the situation, the San Francisco-based firm, which has raised nearly $600 million in capital since 2014, has had tentative deal talks with a number of suitors over the years.
The privately owned firm, which was estimated at $7 billion by investors in December, is also considering going public. Discord appointed its first chief financial officer this month, indicating that it could be gearing up for an IPO. Microsoft and Discord representatives declined to comment.
Microsoft has confirmed that it aims to make it easier for people to play games on their Xbox consoles at home or on their phones while on the go. Following the introduction of new Xbox consoles, its gaming business delivered $5 billion in sales for the first time in the last three months of 2020.
Since then, Discord has tightened its content filtering policies and suspended alt-right groups. Audio, text, and video chat options are available in the app, which enables users to build private servers — in turn, small communities.