In a surprising move, Microsoft announced that it will shut down Mixer, its streaming service, on July 22. Microsoft will partner with Facebook to transition its streamers and viewers to Facebook Gaming.

“We started pretty far behind, in terms of where Mixer’s monthly active viewers were compared to some of the big players out there,” Phil Spencer, Microsoft’s head of gaming, told The Verge.

While Mixer struggled for years to compete with Twitch and Facebook Gaming, the announcement still comes as a surprise. Over the last year, Microsoft made several high-profile deals to bring prominent streamers over from Twitch to Mixer. Ninja, Twitch’s most-popular streamer, signed a contract worth tens of millions of dollars to stream on Mixer. Shroud, another notable streamer, moved to Mixer in a deal estimated to be worth millions, as well.

The high-dollar acquisitions signaled that Microsoft intended to remain in the game for the long haul. Now the streamers are free agents and, according to esports industry insider Rod Breslau, Microsoft paid the duo a combined $40 million to buy them out of their contracts.

As part of the transition, existing Mixer partners will automatically receive partner status on Facebook Gaming. Users with outstanding balances and subscriptions on Mixer will be granted Xbox store credit.

As The Verge explains, Microsoft is prioritizing its next-generation game delivery platform xCloud. xCloud players will be able to stream games to any device, “allowing viewers to click and immediately play games that people are streaming.”

Microsoft has set a goal to reach 2 billion gamers through xCloud, a goal that proved difficult to meet using Mixer, as the platform failed to gain traction.

“When we think about xCloud and the opportunity to unlock gameplay for 2 billion players, we know it’s going be critically important that our services find large audiences and Facebook clearly gives us that opportunity,” said Spencer.

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