Fair enough. These are reasonable takes. I think cloud is the main sticking point for me; but it’s not quite an established market with players dying out.
Microsoft acquired Activision Blizzard King for $69 Billion on 2023-10-13
- Thread starter Rangers
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Silent_Buddha
Legend
Also, keep in mind that Google made a big play there with signed exclusivity contracts for titles from many developers and even publishers. We know this due to the delay for those titles being able to be made available on PC after Google basically announced they were shutting down Stadia. Judgement was one of those. Sega had to wait for their contracted Stadia exclusivity deal to expire before they could release it on PC. Sega is keen to also release their titles on GamePass, but there may still be wording in that Stadia contract that stipulates that it can't come to GamePass yet.
So, exclusivity in and of itself isn't enough to establish a viable cloud service much less such a dominance that it forecloses other's ability to do it. Otherwise Google's efforts with Stadia would have "foreclosed" Microsofts ability to compete in that nascent market.
Of course, that all presupposes that there is a nascent cloud gaming market to establish. We still haven't really seen any evidence that there is going to be large consumer demand for it. It might happen, it might not.
Regards,
SB
Precisely. This is a great add and generally my feeling about cloud gaming. It’s coming sure, eventually the timeline favours this, but success is not going to be made on the backs of exclusivity.
Cynicalking
Regular
I wonder if MS used the 70 billion to instead buy every major third party exclusive it can, would regulators (and some people here) be OK with that? Since it seems that that's "fair and competitive" to them.
The thing is, MS doesn’t want exclusivity. They would never make the profits back from it. Ownership yes, exclusivity no.
Silent_Buddha
Legend
Yup, main reason you'd do that is to deny your competition the ability to compete, thus leaving yours as the only viable platform. After you've "foreclosed" their ability to compete then you have a monopoly on the market that you can then do whatever you want with.
Of course, since that's what some are claiming that MS are doing with the ABK deal (MS can just write off the 69 billion some on this forum like to claim) then MS could have used that 69 billion USD to just purchase multiple year exclusivity from multiple developers/publishers for their "best" titles. And Sony also have been vocal about how this would foreclose their ability to compete in the market and thus they might have to shut down the PlayStation business. Then yeah, they are certainly making that this is Microsoft's intention which means MS are stupid because if that was their intention, they would have been much better served by just buy exclusivity from all the major AAA developers.
Of, course doing so is actually an anti-competitive business practice and will harm consumers and would see regulatory bodies see the need to actually do something. Hence why Sony is being much more subtle about trying to drive MS out of the market with select key exclusivity deals. Which as a business is one way of doing things to maximize profit in a market sector that is still competitive.
In other words, exclusivity of titles is always about trying to push your competition as far out of the market as you can while trying to avoid having regulators take notice. IE - expanding your market share means shrinking a competitor's market share if the market isn't expanding as fast as the share you are gaining.
Regards,
SB
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The difference being that one strategy requires that the downstream party actively maintains a relationship with the upstream party to gain exclusive access to the said resource ...
The other strategy being that the downstream party acquires the upstream party doesn't only gain exclusive access to the resource but they now own the "means of production" as well too ...
The ramifications between the two differing strategies is that the independent upstream party can choose where they want to give their future resources to while the downstream party can choose where their own said future resources are available. Both strategies hurt upstream or downstream competitors and consumer options but acquiring the other party is more powerful since the buyer always has the option of unilaterally depriving their competitors "the means of production" indefinitely. This is what regulators are likely worried about whereas with a "publishing deal", the independent upstream party can choose whatever they want to do in the future with their own "means of production" ...
Silent_Buddha
Legend
You mean like downstream parties have had to do with Minecraft? Oh wait...
So, it actually doesn't require that.
[edit] NM, I read it the wrong way around. Um, if you own a developer, it behooves you to maintain a relationship with that developer regardless of whether you are having that acquired developer make things exclusive or not.
Otherwise something like Lionhead with Peter Molyneux could happen. If people don't remember, that's where MS were 100% hands off (no relationship) and we all know how that turned out. It doesn't mean you have to have a heavy handed controlling relationship (MS after Lionhead implosion and before Phil Spencer took over), but you have to have one regardless.IE - it is far more of a burden to maintain a wholly owned developer than it is to maintain a relationship that allows you to sign a contract for exclusivity.
Regards,
SB
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He’s referring to buying a company and depriving the market of said good a bit like what MS did with Rare a long time ago. They bought them and do largely nothing with them. That’s not going to be the case going forward, MS would be able to address this behind closed doors since their goals in gaming are different than they were back then.You mean like downstream parties have had to do with Minecraft? Oh wait...
So, it actually doesn't require that.
[edit] NM, I read it the wrong way around. Um, if you own a developer, it behooves you to maintain a relationship with that developer regardless of whether you are having that acquired developer make things exclusive or not.
IE - it is far more of a burden to maintain a wholly owned developer than it is to contract for exclusivity.
Regards,
SB
But we’ve seen this play out many times. All the best people left infinity ward to start respawn. The halo team left 343i to stay with bungie. The BF team left to start embark. The blizzard team leaving to start a new RTS studio.
So it’s not exactly the strongest argument unless you have contracts over the labour force leaving.
Silent_Buddha
Legend
Sure but that also was a relationship, just a bad one. I was still editing the post so you didn't get the edit before replying. But Rare were doing things until MS got too controlling due to paranoia that other studios under their banner would start to behave like Lionhead did and thus Rare got strangled with MS telling them they had to do X regardless of whether or not Rare wanted to do Y. They've been freed up again to have more creative freedom and thus we're seeing Rare doing stuff again.
Basically similar to what you're saying.
In either case, it still requires more of a "relationship" as he called it to having an internal studio do an exclusive (or not) than it is to contract a 3rd party to make a title exclusive.
Regards,
SB
Yea lionhead. forgot about that one as well.
It's a bigger burden but it's an undeniably more powerful move as well ...You mean like downstream parties have had to do with Minecraft? Oh wait...
So, it actually doesn't require that.
[edit] NM, I read it the wrong way around. Um, if you own a developer, it behooves you to maintain a relationship with that developer regardless of whether you are having that acquired developer make things exclusive or not.
IE - it is far more of a burden to maintain a wholly owned developer than it is to maintain a relationship that allows you to sign a contract for exclusivity.
Regards,
SB
With a contract, parties negotiate with each other on an independent footing. With an acquisition, the former party becomes subservient to the owner ...
Big difference in the relationships between the two cases and outcomes are different too since the "means of production" now falls into the hands of the owner ...
Why?
The time line is MS entered into an agreement to purchase activision. MS offered a contract renewal to Sony for COD of 3 years. Sony said no so they offered them a contract of 10 years. Sony seems to have said no and made a big stink of it. MS offered the same contract to Valve and Nintendo both said yes. Nintendo doesn't even have Cod on the platform currently.
So how would Sony saying no to a contract and MS saying okay so we wont put it on your console anymore sabotage future investigations against microsoft ? Seems really odd to me. what will happen is if sony says no ms will continue to on with the current contract in place and once its up Sony and Ms will have to renegotiate but if the purchase of activision is already done then sony's barging power is diminished. What's more is if there is a break in releases of cod on playstation because sony tried to hardball negotations that is enough time for cod gamers to purchase an xbox to play cod or purchase a switch/switch 2 or branch into more pc gaming. The longer the gap between playstation cods the more people who will look at other platforms for it.
That would all be Sony's fault. Let's be frank, even if Sony feels that the 10 years is a smoke show and after 10 years MS will yank COD off playstation that still gives them 10 years to develop competiting franchises. They now own bungie with Destiny , they also have some larger ips from the past like socom / killzone / mag / resistance that they would have more than enough time to reboot. But 3 years isn't exactly a lot of time and I'd wager those types of titles would already have to be in development to have a chance of being out and having enough of a fan base to blunt the loss of COD.
Meanwhile MS can continue to parade around saying hey we offered them 10 years and Valve and nintendo jumped on to the same contract so there wasn't anything wrong in the contract. If MS want's to buy another company they will directly point to this. Oh yea with activision we offered 10 year contract extensions on COD and we only made new games or previously non console games exclusive to xbox consoles but still avalible on steam and else where. They can even bring it up when sony purchases a company. Oh hey wait CMA , FTC and whoever else . We had to offer 10 year contracts when we purchased activision we want 10 year contracts offered to us now.
Gabe likely loves this as there is a chance WOW and Diablo and other games come to steam. Elder scrolls online is now on steam so it is possible. Why wouldn't they be happy with a partner that puts their games on their platforms
This is a fairly large ramification that I didn’t see until you pointed this out.
Yup, Sony is playing a really dangerous game at this point. Hope this isn't a case of fuck around and find out about it.
You guys are just driving me insane. MS has been into timed and full exclusives with Third Parties since the beginning of the generation as well.
Its not like Sony went full because they can and poor MS was having problems sealing deals because they have some kind of "money problem" and Sony made it more difficult because they are leaders.
Stalker 2 (Exclusive)
Warhammer 40k (Exclusive)
The Gunk (Exclusive)
Scorn (Exclusive)
Ark 2 (Exclusive)
Adios (Timed exclusive, not released on PS5)
The Artful Escape (time exclusive)
The Ascent (Timed exclusive)
The Big Con (Timed exclusive, not released on PS5)
CrossfireX (Exclusive)
Dead Static Drive (Exclusive)
The Medium (Timed Exclusive)
Echo Generation (Exclusive)
The Falconeer (Timed Exclusive)
Exo Mecha (Exclusive)
Exo One (Timed Exclusive)
Shredders (Timed Exclusive)
Tunic (Timed Exclusive)
Sable (Timed Exclusive)
These are just some that came at the top of my head, ignoring the exclusives that were announced from MS's purchased studios.
MS can very easily make deals. They have a lot more liquidity and ability than Sony.
Sony's current ratio sits at .58!! Sony's assets are valued at around 40billion
Microsoft's current ratio sits at 1.84!!! Microsoft's assets are valued at around 160billion!!
For reference Google's current ratio is 2.52. Its assets are valued at 166Billion!!
If there is one company which has more chances of going bankrupt in case its businesses go wrong its Sony. Sony is very unsafe and Playstation is one of the few markets where they have a healthy presence. Its probably the business that keeps them afloat.
While people complain that poor MS cant beat Sony's exclusive deals, not only MS has more power to do so, that power is what enabled them to strike even beyond Sony and actually purchase Zenimax and ABK! Sony cannot strike such deals. They are incapable. Unless they act totally irrationally.
Just as @Shifty Geezer said, Sony started responding after MS begun (not with third party agreements), but with full large purchases and acquisitions. It looks like a panic move than a market take over from Sony when they started buying more studios. Thats why Sony can't accept those ABK's acquisition to move on. If MS was buying smaller studios neither Sony (or regulators) would have bothered
And MS isnt going to stop there.
MS doesnt make as many third party deals because they are actually buying them instead. In 2018-2019 alone they bought 7 studios. Through Zenimax they bought 9 just in 2021. And now ABK. The two largest purchases in the videogame history. And thats ignoring the timed or console exclusive deals MS made or can make with third parties. Poor MS? Nope.
Its not like Sony went full because they can and poor MS was having problems sealing deals because they have some kind of "money problem" and Sony made it more difficult because they are leaders.
Stalker 2 (Exclusive)
Warhammer 40k (Exclusive)
The Gunk (Exclusive)
Scorn (Exclusive)
Ark 2 (Exclusive)
Adios (Timed exclusive, not released on PS5)
The Artful Escape (time exclusive)
The Ascent (Timed exclusive)
The Big Con (Timed exclusive, not released on PS5)
CrossfireX (Exclusive)
Dead Static Drive (Exclusive)
The Medium (Timed Exclusive)
Echo Generation (Exclusive)
The Falconeer (Timed Exclusive)
Exo Mecha (Exclusive)
Exo One (Timed Exclusive)
Shredders (Timed Exclusive)
Tunic (Timed Exclusive)
Sable (Timed Exclusive)
These are just some that came at the top of my head, ignoring the exclusives that were announced from MS's purchased studios.
MS can very easily make deals. They have a lot more liquidity and ability than Sony.
Sony's current ratio sits at .58!! Sony's assets are valued at around 40billion
Microsoft's current ratio sits at 1.84!!! Microsoft's assets are valued at around 160billion!!
For reference Google's current ratio is 2.52. Its assets are valued at 166Billion!!
If there is one company which has more chances of going bankrupt in case its businesses go wrong its Sony. Sony is very unsafe and Playstation is one of the few markets where they have a healthy presence. Its probably the business that keeps them afloat.
While people complain that poor MS cant beat Sony's exclusive deals, not only MS has more power to do so, that power is what enabled them to strike even beyond Sony and actually purchase Zenimax and ABK! Sony cannot strike such deals. They are incapable. Unless they act totally irrationally.
Just as @Shifty Geezer said, Sony started responding after MS begun (not with third party agreements), but with full large purchases and acquisitions. It looks like a panic move than a market take over from Sony when they started buying more studios. Thats why Sony can't accept those ABK's acquisition to move on. If MS was buying smaller studios neither Sony (or regulators) would have bothered
And MS isnt going to stop there.
MS doesnt make as many third party deals because they are actually buying them instead. In 2018-2019 alone they bought 7 studios. Through Zenimax they bought 9 just in 2021. And now ABK. The two largest purchases in the videogame history. And thats ignoring the timed or console exclusive deals MS made or can make with third parties. Poor MS? Nope.
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Its going to backfire one way or another.
Even if this is some how blocked which I highly doubt. MS will point to it every time. Oh Sony is buying this company and they had these games on our platform we want at least a 10 year contract and so on and so forth.
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