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

[SmooTh]

Doesn't much much but anyway

Антимонопольний комітет України - Комітет дозволив опосередковане набуття компанією «Microsoft Corporation» контролю над «Activision Blizzard, Inc.»

27 квітня 2023 року Антимонопольний комітет України за результатами розгляду заяви компанії «Microsoft Corporation» (США) і компанії «Activision Blizzard, Inc

amcu.gov.ua

 

[mr magoo]

Does what Stadia have to do with latency and bandwidth? Stadia, like many failed content solutions, was an unappealing content service with no USP to drive people to subscribe.

Once companies seriously start competing - which is the environment the CMA want to nurture - and let you rent remote hardware to run your software, including running your Steam library games, then you will see appealing cloud offerings. You can rent cloud hardware to run pretty much any software, where you can run and configure your software just as you could when running locally, except for videogames.

If you want something that doesn't exist, the way you get there is through enabling competition. Because if companies A, B and C don't find something profitable, other companies will. Carving that profit niche out if how Netflix got to be as large as they have.

If content was only issue x cloud would be unstoppable right now.

 

[Inuhanyou]

It's always great to be concerned about a market that isn't really a thing yet (it's impact on the gaming market is little more than statistical noise at the moment) and may never become a thing.

Regards,
SB

That is literally what a regulatory body is supposed to do. Study and make decisions based on potential future impacts of things like corporate mergers and the impacts of unethical behaviors, not the market as it exists.

 

[Inuhanyou]

Can somebody tell me why MS should actually care what some UK org allows?

What can they do if MS just finishes the deal. Block them from their market? That is a gamble the UK would regret.

This seems very silly at this point. This is a UK regulatory body specifically designed to approve mergers and acquisitions and regulate business interests.

Your literally arguing for ignoring an independent regulatory commission because MS doesn't like the outcome of their ruling? What if the FTC and EU commission come to the same conclusion? Should MS simply ignore them as well?

What would stop any corporate body from simply ignoring any type of agency designed to regulate their actions on the basis of not liking their bottom line being disrupted?

There are too many kneejerk tribalist elements out there who don't understand what they are arguing for.

 

[SmooTh]

https://twitter.com/x/status/1651662032461250561

Microsoft gaming chief Phil Spencer acknowledged the company's disappointment, saying the UK's decision will slow the approval process, according to a person who attended the meeting. Still, he said Microsoft's desire to pursue the deal hasn't wavered, said the person, who asked not to be identified discussing an internal event.

Spencer told staffers that Microsoft President Brad Smith was up at 2 a.m. Seattle time Wednesday drafting a response to the UK Competition and Markets Authority. He said Chief Financial Officer Amy Hood, who oversees acquisitions, held a senior leadership meeting the same day.

 

[mr magoo]

That is literally what a regulatory body is supposed to do. Study and make decisions based on potential future impacts of things like corporate mergers and the impacts of unethical behaviors, not the market as it exists.

I disagree. In this case it is full speculation and astrology. The potential impact on non existing market cannot be assessed. They are blocking a merger based on impact on market that may not materialize.

 

[Shifty Geezer]

If you want something that doesn't exist, the way you get there is through enabling competition. Because if companies A, B and C don't find something profitable, other companies will. Carving that profit niche out if how Netflix got to be as large as they have.

Disagree on the Netflix example. Netflix got to be as large as they are by winning over investors again and again. They didn't have a sustainable up-front business model and carve themselves a niche by growing that business - they blasted one out of the rock-face with indecent amounts of investment. Their ability to keep investors investing was superior to the failed cloud gaming companies whose investors at some point said "enough is enough" it seems.

 

[Nisaaru]

How so?

The UK Govt spends billions each year with MS on all sorts of stuff. Then there's the consumer market, which is not zero either.

If MS is going to turn around and say to a first world government that it doesn't give two penny bits about regulation then other powers are going to take notice. They (the non-UK powers) might think that MS would say the same to them in other circumstances.

MS is one of the most important companies for the US government/economy. So this can quickly become a political issue if MS asks for support or if some Senator/Party thinks it's good PR and then the UK has to deal with the US system itself which means all kinds of economical retaliations or blackmail threats.

There would be no gain for the UK government to risk any conflict about this. So overruling the CMA would be the most likely outcome in my eyes. It wouldn't even surprise me at all if the UK government uses this CMA decision as a means to get something from the US government in return. Quid pro Quo...

On a corporate level MS has so many ways to retaliate if the UK decides to block any sales related to Activision products if they wanted. Actually they don't even have to retaliate at all because their UK customers would make some stink about it.

 

[Shifty Geezer]

I disagree. In this case it is full speculation and astrology. The potential impact on non existing market cannot be assessed. They are blocking a merger based on impact on market that may not materialize.

I think it's more informed than that. They spell out the logic using the console space - bigger library means bigger audience means more interest from developers means bigger library means bigger audience. It snowballs, which is partly why PS did so well. Whether that platform is a fixed hardware unit or virtual hardware unit, the market dynamics will be the same - the more content, the better the uptake. MS as it stands now after buying Bethesda has more studios than Sony, Nintendo, EA, and pretty much any other publisher out there. Acquisition of another publisher, or numerous studios, puts them at an obvious content advantage*. The idea here is to ensure cloud gaming platforms can grow in an environment with less exclusivity so it's not a case of consumers being presented with a PS2 situation, three platforms of which only gets 80% of the content and the others have to make do with 30%.

The CMA is envision a future where when cloud gaming gets up and running with players, no-one is commanding a killer content advantage and all offer broadly similar libraries, with a 10% or whatever variation in terms of exclusives (made up figure) as part of the USPs of each platform. Like we have with consoles - you can play 90% of all games on all machines and don't need to pick a console based on availability of COD or FIFA or GTA or Minecraft.

Thinking about it, I guess one obvious option is to spin off MS Games from Xbox. Have it as a games publisher and have it deal with all platform independently. They can then acquire whatever studios they want as they'll be largely cross-platform save for a few second-party exclusives, without any specfic 10 year deals being needed. Although that'd have to be watched to ensure it doesn't start favouring Xbox/MS systems. I guess the independence of that working relationship could never be guaranteed so such a deal might not be considered.

 

[Chandler55]

one thing I find interesting about cloud gaming is exclusivity isnt really that big of a deal for consumers. they are able to sign up to xbox for a month, play the exclusive games, then dip. or vice versa. whereas with consoles you are kind of locked in on the one device you can afford

 

[Shifty Geezer]

MS is one of the most important companies for the US government/economy. So this can quickly become a political issue if MS asks for support or if some Senator/Party thinks it's good PR and then the UK has to deal with the US system itself which means all kinds of economical retaliations or blackmail threats.

There would be no gain for the UK government to risk any conflict about this.

You do realise that's an argument in favour of big bullies getting what they want, right? The US can disagree, but if tries to manipulate the decision making of other nations by throwing its weight around, it becomes a threat to civilised rule the world over. We have more peace now than former centuries because nations largely got over that immature mentality and have worked on resolving differences amicably, or not and just getting on with things not working out how you want.

 

[Shifty Geezer]

one thing I find interesting about cloud gaming is exclusivity isnt really that big of a deal for consumers. they are able to sign up to xbox for a month, play the exclusive games, then dip. or vice versa. whereas with consoles you are kind of locked in on the one device you can afford

That's a very good point, but I guess it's somewhat nullified by the move to GaaS and titles like COD being something fans don't into/out of, but stick with, investing heavily. So it's fairly different to video streaming where someone can sub to a service to binge-watch exclusive content, then swap to a different platform. It'll depend on the gamer and their interests and what the exclusive library is that they play.

 

[Nisaaru]

This seems very silly at this point. This is a UK regulatory body specifically designed to approve mergers and acquisitions and regulate business interests.

Your literally arguing for ignoring an independent regulatory commission because MS doesn't like the outcome of their ruling? What if the FTC and EU commission come to the same conclusion? Should MS simply ignore them as well?

What would stop any corporate body from simply ignoring any type of agency designed to regulate their actions on the basis of not liking their bottom line being disrupted?

There are too many kneejerk tribalist elements out there who don't understand what they are arguing for.

It's not what "I am arguing for". Personally I loath the current state of global corporatocracy which is used to undermine all nations. But I consider this particular case completely phony to make some kind of political "statement" about "protecting" the markets/customers.

I'm just "asking" why should MS care in our current world?

I'm looking at this from the perspective of MS management/US government interests and how the game is played if the US government gets involved. You know..the reality..we live in.

There is absolutely nothing here for the UK to gain.

Try to look at this whole theatre from a political perspective. Why would the CMA make this decision?

There are 2 potential outcomes now.

MS decides to drop the whole deal with afaik at least 3B damage and potential stock market reactions. (extremely unlikely to me)

or

The UK government will overrule the CMA.

The CMA management is surely aware that its decision has no relevance so that leaves these options.

They are used for an under the table deal with the US government. (most likely to me).

or

They made a powerplay or ideological statement and didn't care losing face when the UK government overrules it.

 

[Nisaaru]

You do realise that's an argument in favour of big bullies getting what they want, right? The US can disagree, but if tries to manipulate the decision making of other nations by throwing its weight around, it becomes a threat to civilised rule the world over. We have more peace now than former centuries because nations largely got over that immature mentality and have worked on resolving differences amicably, or not and just getting on with things not working out how you want.

You seem to have illusions about "fair play" here Just look at the Northstream pipeline destruction...

The US has been a corporate bully for a *very* *long* time. They destroyed nations, economies and financed takeovers with the USD printing press and the help of their intelligence services. This is the dirty reality we live in so I'm looking at this from the real world perspective.

 

[iroboto]

one thing I find interesting about cloud gaming is exclusivity isnt really that big of a deal for consumers. they are able to sign up to xbox for a month, play the exclusive games, then dip. or vice versa. whereas with consoles you are kind of locked in on the one device you can afford

yea the cloud brings down the lock in and barrier to entry.
It's quite consumer friendly from that perspective, but it becomes a trade off for not really owning anything.

But given low little games are replayed, or even finished, I think most would be okay with this.

 

[iroboto]

It's not what "I am arguing for". Personally I loath the current state of global corporatocracy which is used to undermine all nations. But I consider this particular case completely phony to make some kind of political "statement" about "protecting" the markets/customers.

If this were healthcare, or real shit that matters, I know I would be in the favour of blocking (like utilities). But in creative/artistic entertainment, I would be in the favour of seeing competition. Cloud can't lead to scalping, which the main issue with entertainment, particularly ticket sales, and for a greater part of 1.5 years console sales. Cloud sub prices could suck as they increase over time, but at the same time different models will come out that will work for different people, it will likely still be cheaper than buying a game new and selling it to recoup the costs.

 

[Metal_Spirit]

It's not what "I am arguing for". Personally I loath the current state of global corporatocracy which is used to undermine all nations. But I consider this particular case completely phony to make some kind of political "statement" about "protecting" the markets/customers.

I'm just "asking" why should MS care in our current world?

I'm looking at this from the perspective of MS management/US government interests and how the game is played if the US government gets involved. You know..the reality..we live in.

There is absolutely nothing here for the UK to gain.

Try to look at this whole theatre from a political perspective. Why would the CMA make this decision?

There are 2 potential outcomes now.

MS decides to drop the whole deal with afaik at least 3B damage and potential stock market reactions. (extremely unlikely to me)

or

The UK government will overrule the CMA.

The CMA management is surely aware that its decision has no relevance so that leaves these options.

They are used for an under the table deal with the US government. (most likely to me).

or

They made a powerplay or ideological statement and didn't care losing face when the UK government overrules it.

You are aware that body's like the CMA are independent for the very reason that governments should not be capable of messing with their decisions, right?

And even if not like this, why would they interfere? Should the UK be afraid of a spoiled Microsoft that sulks when things don´t go their way?

If, in retorical sense, MIcrosoft ever retaliates againt the UK, do you believe other countries will stay put and wait for the same to happen to them? Should their decision be any different when Microsoft is involved? Of course not!

Microsoft will go to court, and present it´s case. It may win, it may loose. And it will have to accept the outcome as any other company.

I ask you... If there was such a precedent of a government overturning a decision from a independent body, how would all other companies that saw their aquisitions halted feel? Should Nvidia ask for government intervention too, and some compensation in between?

Why do you think Microsoft should have that previledge? Because they sulk when others accept?

 

[chris1515]

https://twitter.com/x/status/1651672372099837957

This was the remedies proposal of MS, all the in app purchase would have been 100% revenue for them on other services.

 

[BRiT]

This was the remedies proposal of MS, all the in app purchase would have been 100% revenue for them on other services.

Yes. That is how cloud service providers like GeForce Now already works. They get their cut through the subscription fee, not from game sales.

Only those who do not know this industry should be surprised by this.

 

[Scott_Arm]

@Shifty Geezer Would it really be reasonable to force the 3rd place by a long shot console (or second by a long shot if you exclude Nintendo) to spin off their game software (being a software company) when they’re trying to buy Activision because they’re already considered to have the worst game library and the worst release rate? Like everybody knows the army of studios they have has been worth nothing, even Bethesda so far. What if Starfield is a bust? I’m expecting Red Fall to be a bust based on the zero hype and lukewarm response to the trailers. The idea that Microsoft’s game library will be too strong in cloud, especially in ten years, seems absurd to me. I’d love to see the demographics of COD but I’d guess they skew older. I don’t think CODs status is a sure thing in ten years.

The public perception of Microsoft’s game library just don’t square with being a market leader in gaming in any capacity.

Is anyone talking about splitting up Sony because of their dominance in the real market that actually exists vs a hypothetical cloud one?

Edit: I just went through the last ten years of Microsoft Studios and Bethesda and it's pretty hilariously bad. Microsoft's library fell off a cliff in 2014 or 2015. They have some great niche titles with small player bases, but that's pretty much it. All of their big "system seller" games are an open trash fire, Gears 5 excluded. Gears still has a sizable market of older gamers, but it's in no way a market leader. Bethesda is I would say pretty much in the same boat since Fallout 4 came out. You have the Dishonored games which are well respected, but even Dishonored 2 is old at this point. The real gem in Bethesda is id software. Machinegames and Arkane make quality games, but I don't think their games have huge audiences. Bethesda as a developer itself is notorious. Fallout 76 is basically a joke and it's the only game they've released since 2015. If Microsoft bought Activision/Blizzard the only real massive game franchises they'd have in their library are the ones made by Activision/Blizzard.