Microsoft acquired Activision Blizzard King for $69 Billion on 2023-10-13

[Deleted member 11852]

I believe it comes from Sony's response to the CMA that I'm sure is linked to somewhere in the thread. It's also in one of the Hoeg Law video's posted in the thread.

I've been active in this thread from day 1. I've read the CMA report and both companies response. People have pointed to documents where they thought it said that what is claimed, but when I've looked, nope. That is no such claim. The only claim I have seen in writing is Sony's claim that putting Call of Duty into Game Pass could 'foreclose' this chunk of their business. Which is true, but is nonsense in that Sony are not entitled to revenue.

But if someone can can point me to that claim in writing, I'll stand corrected. I don't accept "it's somewhere".

 

[Dr. Nick]

I've been active in this thread from day 1. I've read the CMA report and both companies response. People have pointed to documents where they thought it said that what is claimed, but when I've looked, nope. That is no such claim. The only claim I have seen in writing is Sony's claim that putting Call of Duty into Game Pass could 'foreclose' this chunk of their business. Which is true, but is nonsense in that Sony are not entitled to revenue.

But if someone can can point me to that claim in writing, I'll stand corrected. I don't accept "it's somewhere".

That is how some people are reading it. Sony never made the claim but that is how some people are reading their response.

 

[Nesh]

That is how some people are reading it. Sony never made the claim but that is how some people are reading their response.

People can read anything they want out of anything regardless what the original meaning it may be.
I also find it very amusing that for some, a way to even out competition, is for the company with the less market share to commit to undesirable/anti-competitive practices.
This is not how it works. Especially considering what kind of a super giant MS is. They have a very healthy presence in the video game market too.

 

[Deleted member 11852]

That is how some people are reading it. Sony never made the claim but that is how some people are reading their response.

That's fair enough although a bit nutty. If anybody thought about it for just a few seconds, I think most would realise that would be an absurd and dangerous thing for Sony to be claiming.

This would essentially be Sony sending a message to everybody, including shareholders, that one of Sony's most profitable businesses - PlayStation - was so precarious that the removal of Call of Duty could collapse the whole house of cards. Sony's financial reports show that PlayStation is highly profitable and isn't reliant on any franchise.

 

[stu11]

I'm curious to know just how many studios/publishers microsoft feel they need to buy up until they feel they are either at the same level or bigger than Sony. They obviously aren't managing the ones they have right now since they are getting (rightly) slammed for not showing anything at the TGA recently (other than more of Starfield). I guess EA, Ubisoft, Take 2 and then probably the likes of Sega/Capcom/Namco, hell just buy up the rest of the game industry ..lol
I would say making a better job of what you have since what they've been doing up to now is still not working.

 

[Dr. Nick]

I'm curious to know just how many studios/publishers microsoft feel they need to buy up until they feel they are either at the same level or bigger than Sony. They obviously aren't managing the ones they have right now since they are getting (rightly) slammed for not showing anything at the TGA recently (other than more of Starfield). I guess EA, Ubisoft, Take 2 and then probably the likes of Sega/Capcom/Namco, hell just buy up the rest of the game industry ..lol
I would say making a better job of what you have since what they've been doing up to now is still not working.

While I know you are partly joking, I would say it is less about Sony and more about GamePass and then the question becomes just how much content do you need to keep the subscriber base happy and continuing their subscriptions. There are willing 3rd parties that are able to add their content to the service as long as they are not contract bound not to, but Microsoft can't count on them to fill the holes. Netflix and other streaming services deal with this issue.

 

[Nesh]

I'm curious to know just how many studios/publishers microsoft feel they need to buy up until they feel they are either at the same level or bigger than Sony. They obviously aren't managing the ones they have right now since they are getting (rightly) slammed for not showing anything at the TGA recently (other than more of Starfield). I guess EA, Ubisoft, Take 2 and then probably the likes of Sega/Capcom/Namco, hell just buy up the rest of the game industry ..lol
I would say making a better job of what you have since what they've been doing up to now is still not working.

Yeah it is just stupid how this buyout is considered normal and as a solution of MS leveling out competition.
Basically almost every argument in favor of ABK's (and Zenimax's) purchases is summarized to this:
MS is incompetent at making their own offers that people want. So they should compensate through anti-competitive practices by buying out content that people want that found its way in competitors' platforms.

When Xbox boss Phil Spencer says Sony wants to "grow by making Xbox smaller" is hypocritical and nonsensical as it can get. Sony didnt make nor can it make XBOX smaller. XBOX just cant get bigger because they are incompetent. Blaming Sony for their own incompetence and having fanboys whining because Sony just makes better content is immature and pretentious. Really now Spencer? Who is making the biggest purchases in gaming history of multiplatform studios?

 

[Kaotik]

His arguments explaining thy the acquisition is required for the betterment of consumers and competition is not convincing at all to me.

It certainly couldn't be any worse for customers, that's for sure. Activision has infected and practically ruined Blizzard games with outright bs microtransactions, now to the point that you can't even use in-game currency for most things (like hearthstone bg pass)

 

[iroboto]

That is how some people are reading it. Sony never made the claim but that is how some people are reading their response.

No I don't think that has been the narrative here, though, if one were to put it lazily, then perhaps you'd would have said what Silent Buddha said. The narrative by Sony is that if MS owns CoD then it's mass Armageddon and damage to the market and consumers and closing of potential future or current rivals.

It is not that if Sony loses CoD it's over, it's that if MS has it, it's over. It does not claim itself will shutdown, but they ham it up there without explicitly saying it.

That's the claim, and it's being processed as such. If Sony didn't claim that, and there was no risk of it coming true, then MS wouldn't be in stage 2 with 3 regulatory bodies (when compared to the other bodies that disagreed with Sony's claim). There are some things in their response when you put it together, you may walk away with the feeling that they say they can't live without Call of Duty, but they're really saying that there is no replacement for it if MS gets it. Therefore MS, will control the most absolutely important resource in the gaming industry, as written by Sony, thus the trashing of all other FPS games to make this point.

As for their actual claims - it is with respect to MS owning CoD. Not sure if they would make similar arguments if Amazon made a play to own ABK.

Executive Summary

• The Transaction would put this content under Microsoft’s sole control, giving it an unprecedented content advantage, at a point when the industry is at a critical “inflection point” in its evolution (Decision, para. 59)
• This would effectively prevent SIE from competing for the business of a large portion of console gamers, reducing its incentives to invest. In this way, as the Decision found, Microsoft’s strategy would “materially affect Sony’s ability to compete” (Decision, para. 204).
• A foreclosure strategy that significantly restricted SIE’s ability to compete would not result in a level playing field and would have been achieved only by harming competition and consumers.

theory of harm
Because of the importance of Call of Duty content, the structure of the hardware market (where PlayStation and Xbox compete closely head-to-head), and the presence of both indirect and direct network effects, the Decision found that a “material impact on Sony’s ability to compete would have a detrimental impact on the overall competition in the market and ultimately harm consumers” (IS, para. 32). SIE agrees with these findings.

There's more, but I don't want to waste my time here on this. Technical, if you are looking at literal writing, Sony does not explicitly say they would close up shop if MS gets CoD. But they have full intention of leaving that flavour in any readers mouth. When you add up all their statements around detrimental impacts, and inability to compete they are basically saying they are on a long slope to death, that should be the take away from their statement even if they don't explicitly write it.

It would be unfair to say that this isn't what they mean, given the type of responses defending Sony's position on this earlier in this thread. It's definitely what they mean.

 

[Nesh]

It is not that if Sony loses CoD it's over, it's that if MS has it, it's over. It does not claim itself will shutdown, but they ham it up there without explicitly saying it.

Losing is very generic. Losing it because Activision stops making it?
Or losing it because a competitor buys a 69Billion studio that may set their own terms on the product including a possible exclusivity? Thats a huge thing.
Considering its huge success and the amount of users enjoying it on PS it is a big blow on Sony and the millions consumers that own the platform. Also Sony realizes that COD will be a huge money maker for MS on PS. Basically funding MS's strategy through COD sales, to gain dominance from the projects that wont be released on PS.
Surely you can say 10 year old deal should suffice. But thats how you want to see it. Personally I am worried how all these franchises (including Zenimax's and ABK's) besides COD may become exclusive if MS sees fit.
The fact that a huge studio with a track record of originally producing big titles on every multiplatform (new or old) will opt platforms out in accordance to MS strategy to gain dominance if necessary is anti-competitive behavior.

 

[SmooTh]

Dunno if old fromCMA or 3rd party(?)

 

[iroboto]

Losing is very generic. Losing it because Activision stops making it?

Sony is pretty specific in that they mean if MS claims it.

If ABK stops making it, it's a non issue - nothing changes.

Surely you can say 10 year old deal should suffice. But thats how you want to see it. Personally I am worried how all these franchises (including Zenimax's and ABK's) besides COD may become exclusive if MS sees fit.

A child could be born the day the deal is signed and playing CoD until they are 10 years of age. I don't think in 10 years time CoD will be the dominant force it is today, I question it's dominance even now. You cannot keep remaking Modern Warfare 1 and 2. And the other non-modern combats for both Battlefield and CoD have done poorly (in particular WW1/2 timelines or alternate realities and future realities). While current Mil-Sim shooters do very well (see Ghost Recon, The Division, Rainbow Six Siege, Counter Strike). People like their licensed guns and equipment.

I think you mistaken my criticism of arguments as a driving force to push ahead with the merger. I'm simply looking at the statement and judging myself, it's not necessarily right or wrong. Whomever writes stronger arguments or weaker arguments is what I feel the mergers should be decided on. If not the arguments, then it's just arbitrary how mergers are approved or not.

Does MS deserve or should have ABK? I care little, except for ABK being properly run and Blizzard titles returning, but I don't think owning ABK is going to solve Xbox's problems. It's pretty clear there are some major issues they have presently, and I don't see how owning ABK will solve that. It will solve their gamepass library challenges which in turn solve their xcloud library challenges however, and I don't think all of this hoopla is worth that. Fixing their issues with internal studios is fundamental before moving to own more studios.

I take that back.. maybe it might solve some internal challenges

Xbox's Fable reboot suffers from Microsoft's overreliance on contractors

Microsoft’s Xbox exclusive Fable reboot is suffering from Xbox’s reliance on contractors and internal tools. Will the game be able to release in 2023?

stealthoptional.com

In a report from Windows Central, it’s been claimed that development on the Xbox exclusive Fable reboot isn’t going as smooth as expected. As with previous Xbox exclusives — such as Halo Infinite — Microsoft’s overreliance on contractors is causing issues.

Microsoft’s wish to use short-term contractors, usually on six-month contracts, has caused issues with development. Combined with the publisher’s insistence on using internal engines and tools instead of standard tools like Unreal Engine, short-term contractors don’t have enough time to learn how to work within these projects.

According to job listings from 2021, Playground Games’ Fable reboot is being developed with the ForzaTech Engine. Known for the simulation racing games Forza Motorsport, the game engine is a proprietary tool that is not an industry standard that contractors will be familiar, unlike Unreal or Unity.

 

[Jay]

Yeah it is just stupid how this buyout is considered normal and as a solution of MS leveling out competition.
Basically almost every argument in favor of ABK's (and Zenimax's) purchases is summarized to this:
MS is incompetent at making their own offers that people want. So they should compensate through anti-competitive practices by buying out content that people want that found its way in competitors' platforms.

Where as I interpret people saying, it's not anti competitive, it's not illegal, not immoral when compared to general practices in this industry.

Even the scale itself doesn't make a difference. Even though people seem to try to make it inherently the issue.

Hell, even if it was because MS was incompetent so what.
I've heard this view that sony's way is the pure and right way.
Sony has bought many studios, people like to spin it that they made PS exclusives or whatever. Easy to do when your the market leader, and make good use of that fact.
I'm also not against Sony buying studios/publishers, exclusives either.

 

[Nesh]

Where as I interpret people saying, it's not anti competitive, it's not illegal, not immoral when compared to general practices in this industry.

Even the scale itself doesn't make a difference. Even though people seem to try to make it inherently the issue.

Hell, even if it was because MS was incompetent so what.
I've heard this view that sony's way is the pure and right way.
Sony has bought many studios, people like to spin it that they made PS exclusives or whatever. Easy to do when your the market leader, and make good use of that fact.
I'm also not against Sony buying studios/publishers, exclusives either.

Anti competitive behavior can be anti competitive regardless of "morality" or "legality" involved.
Nobody is talking about "purity". We arent talking about virtues and are not part of the discussion. Size, content and what platforms those studios were supporting are part of it, either you want to ignore it or not.

 

[Deleted member 11852]

The narrative by Sony is that if MS owns CoD then it's mass Armageddon and damage to the market and consumers and closing of potential future or current rivals. It is not that if Sony loses CoD it's over, it's that if MS has it, it's over. It does not claim itself will shutdown, but they ham it up there without explicitly saying it.

As Dr Nick said above, some people are reading it like that even though that isn't what Sony said. Sony's statement is a matter of record as part of their evidence to the UK CMA. To be clear, any false statement made in evidence is a criminal offence.

That aside, think about it. Would Sony want to imply that PlayStation is so fragile that it would collapse if Microsoft bought Call of Duty? What kind of message does that send to investors and Sony's senior management? It's utterly mental. Are Sony over-egging their pudding of concerns? Sure they are, but not more than Microsoft claiming the acquisition is good for gamers. Some gamers, but not the entire gaming marker as it is now if Microsoft's acquisition of Zenimax is anything to go by.

That's the claim, and it's being processed as such. If Sony didn't claim that, and there was no risk of it coming true, then MS wouldn't be in stage 2 with 3 regulatory bodies (when compared to the other bodies that disagreed with Sony's claim).

Two of the three processes are citing concerns with impact to markets that Sony don't have a presence in. I must have posted this same extract a dozen times a dozen times, but once more::

303. Most competitors raised concerns regarding (i) Microsoft making ABK games exclusive to its own platform; and/or (ii) degrading the quality of ABK games on other platforms; and/or potential self-preferencing behaviour by Microsoft. These concerns have been taken into account where appropriate in the competitive assessment above.

The key competitors named were Amazon, Apple, EA, Epic, Facebook, Google Netflix, Nintendo, Nvidia, Sony, Twitch, Ubisoft, Utomik and Valve. Most of these companies raised concerns. What companies may say publicly is not necessarily what they may say privately in confidence.

Interesting, the CMA UK released another Microsoft submitted-document today but there is nothing of note in it unless you want to read a potted history of CMA decisions that Microsoft believe are relevant to the current one.

 

[iroboto]

The key competitors named were Amazon, Apple, EA, Epic, Facebook, Google Netflix, Nintendo, Nvidia, Sony, Twitch, Ubisoft, Utomik and Valve. Most of these companies raised concerns. What companies may say publicly is not necessarily what they may say privately in confidence.

I have my doubts on this one and you keep bringing this point up.
It's being ignored because it's way too vague who this implies. The wording implies that it's mostly everyone on this list, but media reports and feedback from Phil Spencer, and the way that MS counters the statements suggest it's only Sony. If there are significantly strong counters from other competitors, MS lawyers would have to address them as well, and we haven't seen that.
So I believe the statement of 'most' is not actually revealing any information on their level of concern. Other than to write in and say, hey we want a presence at the table.
I would agree with you, the many times you wrote previously, but the evidence so far proves contradictory that the CMA has received any sort of real protest outside of Sony.

Unless there is real evidence of their protesting as major concerns, I don't see this statement to mean more than Google and Sony. I apologize in saying this, but leaks of other companies outside of Sony should have come froward by now, which have been fairly on the button with most things. The CMA, who has been releasing documents publicly, have yet to provide anything that isn't written from Sony or MS.

Valve clearly does not have concerns : We know this from Gabe's note
Nintendo did not have concerns : We know this because CMA continues to sideline their business as unimportant in this merger discussion
EA did not have concerns : We know this because they said they are happy for it to occur.

Twitch is not a relevant market player
Nvidia should not have any concerns because they are just a reseller of steam
I have my doubts Epic or Ubisoft cares
Leaving: Apple, Amazon, Facebook and Google. which frankly, while are potential future players, they are likely to leave the market before this merger is even completed.

The evidence so far, is overwhelmingly in favour that this is purely an MS vs Sony debate. Other competitors are clearly not a factor here in protestation. And it should not be on the behalf of the CMA to protest on the behalf of companies who are not protesting. That just wouldn't make any sense either.

 

[BRiT]

the CMA has published a response to the Microsoft / Activision merger from an unknown "Market Participant A" largely backing Microsoft's deal and calling on the CMA to protect consumers and "not to preserve the status quo of competitors"

https://assets.publishing.service.gov.uk/media/6391da18d3bf7f1bcd58284a/Market_Participant_A.pdf

https://t.co/Mst6AwuFZr

https://twitter.com/x/status/1602342641181548544

 

[Deleted member 11852]

I have my doubts on this one and you keep bringing this point up.

So your position is that the UK regulator, whose decisions can be appealed and examined by an independent oversight authority, or even be made subject to judicial review and forced into a UK court to dispose their processes, assessments and have evidence examples, are...
what? What is it you are suggesting?

It's being ignored because it's way too vague who this implies. The wording implies that it's mostly everyone on this list, but media reports and feedback from Phil Spencer, and the way that MS counters the statements suggest it's only Sony. If there are significantly strong counters from other competitors, MS lawyers would have to address them as well, and we haven't seen that.

And the reason why these processes preserve anonymity is because some companies may not be comfortable going public due to the risk of jeopardising existing business realtionship with Microsoft. Part of these assessments is to weed any any bullshit. And, the wording used doesn't imply "mostly everybody", "most" means most, i.e. more than half.

It's interesting that some so readily believe things Phil Spencer tweets, even though there is no consequence for lying in tweet or to the press, but distrust processes by multiple regulatory bodies where the consequences for lying are harsh - criminal certainly, steep fines and imprisonment because it's basically fraud and corruption.

I know who I have greater reason to disbelieve, when Phil Spencers claims that reaches out to Sony at the beginning to strike a deal, but when no reference to this was made prior to September after the CMA reported, and Microsoft's own evidence to the CMA doesn't mention it either, I call bullshit. Had that happened, Microsoft absolutely would include that correspondence in their evidence because it would be an irrefutable gesture of their intention to act in good faith. This is pivotal point that matters to regulators.

@BRiT one company has come in support of Microsoft and maybe this will spur more to do likewise if they feel this way too. In such a massive industry, that is not currently a lot of overt support. But this is why anonymity is important, this may be a party that does not wish to jeopardise their relatioship with Sony.

 

[Jay]

Anti competitive behavior can be anti competitive regardless of "morality" or "legality" involved.
Nobody is talking about "purity". We arent talking about virtues and are not part of the discussion. Size, content and what platforms those studios were supporting are part of it, either you want to ignore it or not.

I'm also saying I don't see it as anti competitive as well as all those other stuff.

 

[iroboto]

are...
what? What is it you are suggesting? And the reason why these processes preserve anonymity is because some companies may not be comfortable going public due to the risk of jeopardising existing business realtionship with Microsoft. Part of these assessments is to weed any any bullshit. And, the wording used doesn't imply "mostly everybody", "most" means most, i.e. more than half.

I'm suggesting the CMA has a reason to preserve anonymity. But that doesn't mean what they wrote is that _most_ of these companies are against the mergers. Concerns are not protests against the merger. They are concerns.

If I am to understand correctly in phase 1, the regulatory bodies seek feedback from the industry. The CMA compiles the feedback and submits their POV of how the process should continue. They provide MS a time period a chance to offer counter statements to the feedback, failing to do so will proceed with a Phase 2 investigation.

And that's been the main driving logic here. The CMA response largely follows Sony's response, and MS response largely aims to counter Sony's response. In all the deliberation between the two, I haven't seen MS actually go out of there way to mention anyone but Sony. I find this suspect, because you know they would if they needed to. I would also ask, if anonymity is so important, why in this case did the CMA release both MS and Sony statements publicly, but choose to keep everyone else's statements from going public. If you want to build a stronger case against Sony, shouldn't one be removing all competition names from the documents so that MS has an aimless target to fight against?

It just doesn't make any sense to me, that in 1 case, we are keeping folks anonymous, and in another we are not. Now in the case above where someone asked for anonymity look at how carefully they crafted that message and even in that message they specifically target Sony. It is in my mind, that MS must be at least allowed to see the arguments against them in order to engage with them. If most of these competitors are protesting (not concerned, but actively protesting like Sony) I think the response from MS would be very different than the one we are reading about now.

Remember, they asked for the public's input, and it's hard to provide input if you don't know the arguments. And heck, we certainly wouldn't be given a redacted pro-consumer statement from redacted. I couldn't even guess who this entity is.

Don't take this as me saying CMA = bad, or doing dodgy stuff. They have used wording to protect anonymity, and they have also used the words 'concerned', which is not to say the same as 'detrimental impacts to consumers'. We haven't seen MS respond to anyone but Sony statements. MS accuses CMA of picking up entirely Sony statements. CMA only releases Sony's statements. I mean, I'm not going to say there isn't a slim possibility that 50% of these other guys are secretly trying to take down MS (likely par for the course here), but the receipts so far don't suggest that.