How much does a global phenomenon cost? Lots of people have wondered how much it cost to create one, but Microsoft has gone out of its way to explain, in no uncertain terms, how much it cost to purchase one outright. And the answer, I think, surprised everyone.

Mojang, led by fedora-wielding face of indie game development Notch, has just been bought by Microsoft for the tidy price of $2.5 billion. This is big news for both companies, both because of what it may mean to Mojang’s future and how Microsoft is going to make any return on this purchase after Minecraft has already sold more than 50 million copies worldwide.

Now that the dust has settled and the world is coming to terms with what the sale means to the future of the game (more on that in a moment), I want to start asking the big question: Does this price tag, even for a game as wildly successful as Minecraft has been, make any sense?

The answer is yes, but not in the way that you think.

Microcraft (Minesoft sounds like a caveman with erectile disfunction) is probably not going to sell vast numbers of games going forward. 50 million is a heck of a sales figure for any game and the marketing penetration of the game has been all but absolute. Even some of the people I work with, who I have to show how to turn their computer off on occasion, have heard of Minecraft. They haven’t played it, but they probably won’t play any video games. Its not their scene and that’s fine. I try not to judge them too harshly for their heathen ways. The point is that they know of Minecraft probably because someone in their immediate family loves it. That’s what happens when a game becomes iconic; non-gamers start knowing it by name and Minecraft has definitely achieved that status. And doing so has put a whole lot of money in Mojang’s pockets.

This put Microsoft in a bit of a pickle. They desperately wanted to suckle upon Notch’s sweet, money-filled teet, but to do so, they were going to have to pay a ton of cash. Sure, they could create a Mineclone. Several other people have and released them without putting so much as a dent in Mojang’s ever-growing bank account because they lacked the name and the power to create a brand that could rival the original, but they’re not Microsoft. Microsoft is one of the largest companies on the planet, to the point where they might even call Minecraft’s impressive market penetration “quaint”. If they wanted to, they could easily put out a reasonably good clone, brand it up to make it look similar enough to confuse unsuspecting parents, and then just wait until theirs was the most successful. Essentially, they would create the Go Bots of today’s market.

But doing so might not make financial sense. That kind of campaign would cost money. Money for marketing, development, PR as they try to smooth things over with a gaming community that would see this as a true David and Goliath type situation. It might take them a while, but Microsoft could weather that storm and come out the other side without even a dent to their reputation. Gamers would forget their rage and hatred over time and Mojang would fade into obscurity, eventually being accused of being the imitator themselves.

In the long run, it probably would have been cheaper and easier to simply buy the company outright for a seemingly huge cost than to bother with that whole PR nightmare waiting to happen. Pay $2.5 billion now and get to immediately make money off of the investment while the brand is still hot or pay $3 billion to build their own brand and potentially miss the largest payoff for it? It’s a pretty easy answer, really.

Which brings me to the biggest question of all: What is the payoff going to be? Can Microcraft sell enough copies to pull a profit after factoring in the huge price they just paid for it? Maybe, but that’s not where the money is going to at in the near future for the game. In the run up to the holiday season, the name of the game is going to be merchandising. Minecraft has already enjoyed pretty significant success on this front, with diamond swords becoming common on the streets and pixelated heads becoming a favourite costume at conventions around the world. This is a purchase of the Minecraft brand more than anything else, a chance for Microsoft to make money off of the next big holiday phenomenon as quickly and easily as possible.

Game sales are not the driving force behind this purchase. Minecraft has sold more copies than anyone could have predicted and it just keeps going at an alarming rate, but the bulk of their sales are behind them. It’s the merchandising that is going to be the gravy train going forward.

As for the future of Mojang, all we can really say for sure is that Notch and the other current owners of the company are being bought out by this deal, seemingly forcibly ejected from the company they created and built. No one is saying that one man has ran this company alone, but he certainly was the driving force and the face of both this phenomenon and that of indie gaming in general. Notch may never get the chance to repeat this success. Which I’m sure is going to upset them as they drag their ridiculous paycheques to the bank. Or whatever it is that billionaires store their money in.

So back to my original question: Does this purchase make any sense? I think it does. Microsoft is going to make a veritable boatload of money in the next few months off of this purchase and will have the resources and experience to extend the Minecraft craze a few more years, allowing them to grow their new empire and truly reap the benefits of this move.

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