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

[Deleted member 11852]

They also added Bethesda games to Playstation Plus's service when the on demand/streaming stuff was launched. Although, I don't know if any of the Bethesda games are streamed since... You know, it's impossible to tell what's what on that service. But Skyrim is used prominently in the marketing on the main page of PS+.

Skyrim was added to PS+ Extra and Premium (the mid and upper tier subscription packages) in November 2022. Would that have happened if Microsoft weren't under incredible scrutiny from regulators on their services? Nobody can say, but the CMA commented that Microsoft's motives were not clear cut - based on Microsoft's own documentation released to the CMA.

Most importantly, Microsoft's submissions do not address the fact that a Microsoft senior employee [REDACTED]. In any case, we consider that these motives ([REDACTED] licensing) are not mutually exclusive and [REDACTED] are likely to have contributed to Microsoft's decision to remove the two Bethesda games.

 

[Dr. Nick]

You quoted in full why this was categorised as a concern. Microsoft had created a licensing process to assess which games can appear on rival streaming services, which were assessed by consulting internal Microsoft teams. None of the assessment was predicated on contractual or legal obligations, and having consulted internally for some games, and received no objections from the internal Microsoft teams, Microsoft refused to allow some games to appear on Geforce Now rather than pursue licensing with Nvidia.

What the CMA are saying, is that Microsoft were motivated to remove content from rivals - which is kind of important in the context of the acquisition. And it's further examples of where Microsoft's internal document has failed to evidence their public position on policies.

If contracts and legal obligations were in place, Microsoft would not have pulled content. This was not going to be the case with Sony or most other stores and marketplaces as there is usually some type of instrument to make having it on their service legal and possibly binding. Nvidia's business model has been problematic because of this, which is part of why some publishers keep their games off of the service.

 

[Nesh]

If contracts and legal obligations were in place, Microsoft would not have pulled content. This was not going to be the case with Sony or most other stores and marketplaces as there is usually some type of instrument to make having it on their service legal and possibly binding. Nvidia's business model has been problematic because of this, which is part of why some publishers keep their games off of the service.

but thats the thing. Games released by third parties are released and are staying there unless some complication arises such as a license expiration of some sorts like what happened with XMEN and Simpson games.
But here the games were removed because there was no legal obligation to keep them in a competitive platform. It shows MS internal motivation to keep content away if they can and serves them.
And thats what is 100% guaranteed will happen with many games and franchises. MS themselves said that they made the acquisitions to bring more exclusive content on XBOX.

 

[troyan]

Isnt the source code of Quake 2 open source?

 

[Deleted member 11852]

If contracts and legal obligations were in place, Microsoft would not have pulled content.

The missing gaps in the provisions findings, along with the lack of any evidence demonstrating Microsoft ever tried tonegotiate a licence with Nvidia, tell a different story. This is several paragraphs of the report cover:

294. Microsoft also submitted that one of these two titles, Wolfenstein: Young Blood, continued to remain on Google Stadia, which is also a competitor to Xbox Cloud Gaming, as a valid licence agreement was in place.

295. We consider that Microsoft did not provide convincing evidence to show the full motives behind Microsoft’s decision to remove Wolfenstein: Young Blood and Quake 2 RTX from NVIDIA GFN.

296. Most importantly, Microsoft’s submissions do not address the fact that a Microsoft senior employee [REDACTED]. In any case, we consider that these motives ([REDACTED] licensing) are not mutually exclusive and [REDACTED] are likely to have contributed to Microsoft’s decision to remove the two Bethesda games.

This paints a clear situation where Microsoft decided to remove the two games rather than pursue a licence with a rival service (GFN), and Microsoft couldn't satisfactory explanation as to why one service (Stadia) was allowed to licence the two games and one (GFN) was not, but in the following paragraphs the CMA speculates that it's because that Nvidia was a serious competitor and Google was not:

297. As set out above, we provisionally believe that cloud gaming will continue to grow and be profitable in the next five years. In a nascent market, particularly those characterised by some element of direct and/or indirect network effects, success is highly uncertain for new entrants, and there is a greater opportunity (and stronger incentive) for incumbents to engage in foreclosure strategies in a bid to acquire market power.

298 In this case, we provisionally believe Microsoft is already one of the strongest incumbents in cloud gaming services as evidenced by current market shares, and its multi-product ecosystem means that it is well positioned to compete in this market as it continues to grow and develop. As set out above in our TOH 2 framework, Microsoft will have a stronger incentive to foreclose given its uniquely strong position in cloud gaming.

299. Microsoft’s internal documents reveal a strategy of not making its first-party titles available on rival cloud gaming platforms. [REDACTED].

What the CMA concluded, is Microsoft were content to licence two titles to Google because their market share was minuscule market, but not to Nvidia who have a sizeable streaming market share. The CMA note that Microsoft's own documents show that will not make first part titles available on rival platforms.

From the context, 'rival' means a service that has market share comparable to Microsoft's.

 

[see colon]

but thats the thing. Games released by third parties are released and are staying there unless some complication arises such as a license expiration of some sorts like what happened with XMEN and Simpson games.
But here the games were removed because there was no legal obligation to keep them in a competitive platform. It shows MS internal motivation to keep content away if they can and serves them.
And thats what is 100% guaranteed will happen with many games and franchises. MS themselves said that they made the acquisitions to bring more exclusive content on XBOX.

nVidia's service (Geforce Now) is sort of unique in that they don't sell games. You subscribe to the service (there is a free tier as well) and link you Steam, GOG, Ubisoft or EA account (I think it supports all these storefronts, maybe more, maybe less) and you can stream the games you already purchased from those storefronts. What nVidia is charging for (or giving away for free in the free tier) is the use of their is access to their cloud hardware to run the games you already own. What makes it problematic is they are almost renting games to you that you already purchased, and some publishers had already signed exclusive streaming rights away for their games. So for nVidia to swoop in and circumvent that resulted in them adopting an opt out policy for games.

Isnt the source code of Quake 2 open source?

It is, but the game content is not. So all of the levels, story, monsters, and the setting are all still owned by id software.

This paints a clear situation where Microsoft decided to remove the two gains, rather than pursue a licence with a rival service, and Microsoft couldn't satisfactory explanation as to why one service (Stadia) was allowed to licence the two games and one (GFN) was now, but in the following paragraphs the CMA speculates that it's because that Nvidia was a serious competitor and Google was not:

Nothing is clear about that situation except for the fact that the games were licensed to Stadia at one point and more recently licensed to nVidia. This sounds like normal business. No storefront or service has the right to sell every game without first securing those rights from the rights holder. If this is the line of reasoning that we are going to follow, is the CMA going to star forcing Xbox to publish Halo on Playstation and Playstion to publish Last of Us on Xbox?

 

[Deleted member 11852]

Nothing is clear about that situation except for the fact that the games were licensed to Stadia at one point and more recently licensed to nVidia. This sounds like normal business. No storefront or service has the right to sell every game without first securing those rights from the rights holder.

Nvidia made no fuss. What the CMA's most report describes is that Microsoft's public narrative on "games everywhere" and "we don't like exclusivity" does not describe Microsoft's actual business policies when it comes to competing with rivals. This seems sensible but Microsoft are trying to persuade regulators that they won't do any of the things that their internal policies state that will do. Microsoft are trying to convince the regulators that the various markets impacted, will not change much.

Microsoft rhetoric from day one, as far back as the Zenimax acquisition, is that "it doesn't make commercial sense" to remove titles from other platforms, but they did that with Redfall, Starfield and Elder Scrolls VI on consoles, and following that same acquisition Microsoft chose to allow two games to continue to be included on a small streaming platform (Stadia) but chose to not to allow it on the largest streaming platform (Geforce Now). As the CMA report notes, not allowing first party titles (and those games became first party titles) to rival platforms. All this demonstrates is that Microsoft considered GFN a rival but didn't consider Stadia a rival.

If this is the line of reasoning that we are going to follow, is the CMA going to star forcing Xbox to publish Halo on Playstation and Playstion to publish Last of Us on Xbox?

No, none of the regulators have such powers. What does that even have to do with the current acquisition? Like iRoboto, I don't think you quite understand the very narrow remit of these processes. It is not the regulators role to assess the video game market to determine that Sony are doing a better job of it and that there is a need to help Microsoft a bit.

These assessments are entirely about the the impact of various markets were Microsoft be given approval to acquire Activision-Blizzard. Unfortunately for Microsoft, there is a pattern of internal policies undermining public statement. And in the case of these two titles being removed from GFN, Microsoft failed to convince the CMA that there was a rationale decision behind that.

 

[Nesh]

Nvidia made no fuss. What the CMA's most report describes is that Microsoft's public narrative on "games everywhere" and "we don't like exclusivity" does not describe Microsoft's actual business policies when it comes to competing with rivals. This seems sensible but Microsoft are trying to persuade regulators that they won't do any of the things that their internal policies state that will do. Microsoft are trying to convince the regulators that the various markets impacted, will not change much.

Microsoft rhetoric from day one, as far back as the Zenimax acquisition, is that "it doesn't make commercial sense" to remove titles from other platforms, but they did that with Redfall, Starfield and Elder Scrolls VI on consoles, and following that same acquisition Microsoft chose to allow two games to continue to be included on a small streaming platform (Stadia) but chose to not to allow it on the largest streaming platform (Geforce Now). As the CMA report notes, not allowing first party titles (and those games became first party titles) to rival platforms. All this demonstrates is that Microsoft considered GFN a rival but didn't consider Stadia a rival.


No, none of the regulators have such powers. What does that even have to do with the current acquisition? Like iRoboto, I don't think you quite understand the very narrow remit of these processes. It is not the regulators role to assess the video game market to determine that Sony are doing a better job of it and that there is a need to help Microsoft a bit.

These assessments are entirely about the the impact of various markets were Microsoft be given approval to acquire Activision-Blizzard. Unfortunately for Microsoft, there is a pattern of internal policies undermining public statement. And in the case of these two titles being removed from GFN, Microsoft failed to convince the CMA that there was a rationale decision behind that.

Officially Welcoming Bethesda to Team Xbox - Xbox Wire

Publisher of iconic gaming franchises will expand Xbox’s diverse portfolio on Xbox Game Pass This is an exciting day for Xbox. Today we officially complete the acquisition of ZeniMax Media, parent company of Bethesda Softworks. It’s an honor to welcome the eight incredibly talented development...

news.xbox.com

This is the next step in building an industry-leading first party studios team, a commitment we have to our Xbox community. With the addition of the Bethesda creative teams, gamers should know that Xbox consoles, PC, and Game Pass will be the best place to experience new Bethesda games, including some new titles in the future that will be exclusive to Xbox and PC players.

Microsoft Finally Confirms That Bethesda Will Make Exclusive Games For Xbox And PC But Many Questions Remain

Microsoft finally makes it official: some of Bethesda's future games will be exclusive to Xbox and PC.

www.gamespot.com

Microsoft Reveals Its Unsurprising Stance On Xbox/PC Exclusivity For Bethesda Games

Microsoft wouldn't be entering into this $7.5 billion deal without looking to drive some gamers (and hence revenue) to its Xbox Series S/X consoles and PC platform.

hothardware.com

"This is the next step in building an industry-leading first-party studios team, a commitment we have to our Xbox community," said Spencer in a blog post announcing the completion of Microsoft's ZeniMax acquisition. "With the addition of the Bethesda creative teams, gamers should know that Xbox consoles, PC, and Game Pass will be the best place to experience new Bethesda games, including some new titles in the future that will be exclusive to Xbox and PC players."

Their intention to make games exclusive for their platforms is plastered all over the palce from their very own statements. There is no real agument about MS incentives to support all platforms.
They are apparently selective accordingly, to convince regulators. Examples like Minecraft to paint MS as a good company that has under its best intentions to support everyone and bring games on every platform is sugar coating of a unique case. MS will do anything in its power to both maximize profits and shift marketshare. Thats what all companies want not just MS. The difference is that MS is in a very very powerful and unique position that other competitors are limited by their own financial prowess and structural capabilities to do so.

IMO both Zenimax and the ABK acquisitions should have been prevented. It would have been much healthier if MS actually made special deals with those companies and purchased small to medium studios instead of actually purchasing the largest.

This isnt going to stop there if greenlit. The industry will turn into an arms race where the winner is defined simply by who ever owns the biggest and most studios. And thats BS

 

[Shifty Geezer]

Third party responses indicate that most current competitors, with the exception of Nintendo, self-supply cloud infrastructure. For example:

(a) Amazon [REDACTED], which has the [REDACTED].

What?! What does Amazon have that could power cloud gaming?? Damn all these obscured details. The mystery deepens...

 

[Deleted member 11852]

What?! What does Amazon have that could power cloud gaming?? Damn all these obscured details. The mystery deepens...

That is Luna, which is a variation of Amazon's G4 server instance which has Nvidia T4 GPUs - which are based on Turing (RTX2080/Ti) with around 8.1Tf power, along with Cascade Lake CPUs. This all runs Windows and supports DirectX RT.

 

[fehu]

I think that he's referring to the "bring your gaming pc to power the cloud to not be fired for today" amazon employee program.

 

[see colon]

Nvidia made no fuss. What the CMA's most report describes is that Microsoft's public narrative on "games everywhere" and "we don't like exclusivity" does not describe Microsoft's actual business policies when it comes to competing with rivals. This seems sensible but Microsoft are trying to persuade regulators that they won't do any of the things that their internal policies state that will do. Microsoft are trying to convince the regulators that the various markets impacted, will not change much.

Microsoft rhetoric from day one, as far back as the Zenimax acquisition, is that "it doesn't make commercial sense" to remove titles from other platforms, but they did that with Redfall, Starfield and Elder Scrolls VI on consoles, and following that same acquisition Microsoft chose to allow two games to continue to be included on a small streaming platform (Stadia) but chose to not to allow it on the largest streaming platform (Geforce Now). As the CMA report notes, not allowing first party titles (and those games became first party titles) to rival platforms. All this demonstrates is that Microsoft considered GFN a rival but didn't consider Stadia a rival.

I've tried to avoid assigning motivation to the actions taken in regard to what the regulators are looking at, simply because I think it's impossible for us to know the actual motivation. That's why, if you look back a page or two, I was arguing about Bethesda games appearing on PS5 and defending those releases from attacks about motivation, in the form of contractual obligations.

That said, if you look at the quote, it does state "removing games", which is clearly rooted in games that already exist. Redfall, Starfield, and ES6 do not exist to be removed. Even if you ignore the language and consider removal to mean foreclosure, there is also a whom element here. Removed from whom? We know, for example, Redfall will be on PC and Xbox. We also know that the recent MS/nVidia deal would bring their current/future PC games to GFNow. We've also seen every PC game released on Windows Store/Gamepass get a release on Steam as well. Time will tell if they get a release on Epic Game store, but traditionally Bethesda games have including their more recent releases Hifi Rush, Deathloop and Ghostwire Tokyo (Xbox Games Studios games usually don't end up on Epic). I don't think anyone expects Redfall on Switch. So that leaves Sony. They might not get Redfall. But it isn't as if Bethesda hasn't made console exclusive games before.

Also, we can't know if MS views GFN as a rival. They could have simply wanted to monetize the streaming, or negotiate a deal more favorable in another way. Or, there could have been privacy concerns regarding signing into a Bethesda.net account on a 3rd party remote server. A concern that perhaps Microsoft had but Bethesda did not. Again, motivation is a tricky subject that I've tried to avoid, because we can't really know what the motivation is.

 

[Deleted member 11852]

I've tried to avoid assigning motivation to the actions taken in regard to what the regulators are looking at, simply because I think it's impossible for us to know the actual motivation. That's why, if you look back a page or two, I was arguing about Bethesda games appearing on PS5 and defending those releases from attacks about motivation, in the form of contractual obligations.

As far as the EU and UK processes go, there are no motivations for the regulators. These are apolitical and transparant assessment process that following published processes and use a clear criteria.

Microsoft continuing to allow acquired properties on competing platforms, and that includes next gen version of Skyrim (released after the acquisition) and Fallout 4 (realising sometime this year) will be balancesd with decisions like Microsoft deciding to make Redfall, Starfield and Elders Scrolls VI console exclusives, and - as per more recent discussion - Microsoft decided against pursing licensing of two formerly-Zenimax titles for Geforce Now, which was a bigger streaming platform than xCloud at the time of acquisition.

That said, if you look at the quote, it does state "removing games", which is clearly rooted in games that already exist. Redfall, Starfield, and ES6 do not exist to be removed. Even if you ignore the language and consider removal to mean foreclosure, there is also a whom element here. Removed from whom?

Removal would be from platforms, but also from consumers who do not use platforms where content is available. This is on the context of prior commitments, i.e. back when Microsoft were making their case for acquiring Zenimax they said that they would review new new games on a per title basis but to show how quickly policies can change, the CMA recently noted that it was now Microsoft's policy not to licence first party games on rival streaming services:

299. Microsoft’s internal documents reveal a strategy of not making its first-party titles available on rival cloud gaming platforms. [REDACTED].

We know, for example, Redfall will be on PC and Xbox. We also know that the recent MS/nVidia deal would bring their current/future PC games to GFNow.

I think you need to question - as the CMA have - the motives of Microsoft because their internal policies have contradicted several public statements. You also have to question whether Microsoft all this very recent effort only under the lens of regulatory scrutiny. The narrative being presented by EU and UK regulators is when left to their own volition, Microsoft's tend to lean in on establishing policies to prevent new releases of IP on rival platforms and the CMA noted that this is was literally Microsoft's policy.

I would add that I'm really not taking notice of anything that Microsoft and Sony are saying publicly, it's clearly mostly bullshit. I am only reading independent regulator accounts of what is going on. The regulators do not seem convinced

 

[iroboto]

What?! What does Amazon have that could power cloud gaming?? Damn all these obscured details. The mystery deepens...

Not sure if I read this correctly, but they have a Luna streaming service that is like xcloud and ps now.

 

[see colon]

I think you need to question - as the CMA have - the motives of Microsoft because their internal policies have contradicted several public statements. You also have to question whether Microsoft all this very recent effort only under the lens of regulatory scrutiny. The narrative being presented by EU and UK regulators is when left to their own volition, Microsoft's tend to lean in on establishing policies to prevent new releases of IP on rival platforms and the CMA noted that this is was literally Microsoft's policy.

This is what I mean right here, though. We don't know their motivations. Only the actions Microsoft has taken since acquiring Zenimax. Did they pull games from Geforce now? Yes. Do we know why? No. Again, it could have been to scuttle the streaming operations of nVidia. It could have also just been concerns over privacy or access to Microsoft (Bethesda.net) accounts. It could have simply been about wanting a monetary return for streaming rights. They also made Bethesda games available to PSN+ tiers after acquisition. Are we going to thought police their motivation for that as well?

And again, I don't know if it's Microsoft's policy to not launch new IP on rival platforms. Hifi Rush launched into Steam and Epic. Mighty Doom isn't on Xbox at all. Most of the Mojang stuff is multiplatform including on Playstation and Switch. Exceptions being Crown and Council. That's on Mac, Linux and PC but the PC version is only on Steam - Not on Windows Store. And Minecraft Earth, which is Android and IOS only.

If you look at the facts without trying to assign motivation, it doesn't look like there is some strict mandate to only make Xbox games.

 

[Shifty Geezer]

That is Luna, which is a variation of Amazon's G4 server instance which has Nvidia T4 GPUs - which are based on Turing (RTX2080/Ti) with around 8.1Tf power, along with Cascade Lake CPUs. This all runs Windows and supports DirectX RT.

Not sure if I read this correctly, but they have a Luna streaming service that is like xcloud and ps now.

I was sarcastically reacting to the redaction of common knowledge. Who's deciding what's redacted and according to what rules?

 

[Dr. Nick]

Are we going to thought police their motivation for that as well?

That is kind of what the CMA is doing there. I would assume they would have called Microsoft out if they had evidence that truly contradicts Microsoft's explanation. They are saying they don't trust Microsoft's explanation.

 

[SmooTh]

Dunno if old
FTC denied and granted in part Sony's motion

 

[Dr. Nick]

Dunno if old
FTC denied and granted in part Sony's motion

Going back to 2019 does not go back far enough IMO.

 

[BRiT]

Dunno if old
FTC denied and granted in part Sony's motion

Tweet with some pics for those who don't want to read the PDF directly:

https://twitter.com/x/status/1631041830103003140