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

Sounds like the right move by the EC/EU then. Maneuver MS to force growth in the space or block it. This is how regulators should be thinking in a nascent market.

Yes, but Microsoft didn't volunteer this out of the goodness of being consumer friendly - they were forced! CMA/UK for right or wrong have the right to reject Microsoft's proposals or afterthought remedies, that's their prerogative. In essence, EC/EU did what was best for their market, and CMA/UK did what was best for their market, and as such, I don't find neither of their decisions to be wrong in that regard.
 
But how does it work for a competitor like sony ?
Sony likely has to ask for a license, like all other cloud providers, which would be automatic, so any user which purchased COD on PS5 could stream it via PlayStation Plus Premium tier IF Sony ever expanded to use PS5 Hardware AND allowed gamers to stream games they own. It's a little simpler if they were PS4 version purchased. But Sony still needs to move to allow PlayStation Plus Premium users to stream games they own.
 
Yes, but Microsoft didn't volunteer this out of the goodness of being consumer friendly - they were forced! CMA/UK for right or wrong have the right to reject Microsoft's proposals or afterthought remedies, that's their prerogative. In essence, EC/EU did what was best for their market, and CMA/UK did what was best for their market, and as such, I don't find neither of their decisions to be wrong in that regard.
That means all parties are doing what they should have done.
MS should be giving away as little as possible.
The regulators should be looking out for our best intersts.

EC/EU found a way and it was quite a simple resolution imo.
UK blocked which is an easy out, and I found this to lack vision and leadership when compared to the solution forced by EC/EU.
When I read the CMA's responses, I felt like I read someone who said I didn't really know what the right answer was, and I don't want to mess up the largest merger case in the history of the world, so better off just blocking it and taking the safe road.

It was a missed opportunity to turn it into something positive. From that perspective I still think they're wrong. Blocking could have even poorer consequences than a merger.

EU commentary on the approval - unfortunately cannot embed

The most reasonable answer provided by the commission.
 
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I'm mostly looking at the freebie commitments Microsoft has made on getting EC/EU approval (a sign that cloud gaming/services is VERY important to them!), and the EC/EU ruling laying out their cloud gaming concerns, but were ultimately satisficed with Microsoft's generous commitments. As such, CMA concerns about cloud gaming in the UK are justified from the perspective that they see Microsoft as a threat in growth of their own homeland cloud services. But I do wonder, if these generous commitments from Microsoft were ever made to the CMA on trying to get approval, or was it a last ditch effort on getting EC/EU approval?

I view MS offering the streaming services and access to streaming services free as a nod towards there being no current or foreseeable hit to profits or revenue that are more than statistical noise because the market itself is still within statistical noise.

IE - it hurts them not at all to offer that as freebies because currently and for the forseeable future, it'll have no negative impact. However, by having more streaming services offering cloud stream of their games, there is a larger potential for cloud game streaming to become more than just statistical noise WRT revenue generation.

I'm doubtful, but that appears to be the basis of the EU remedy. Basically, they see this as potentially the only way cloud gaming becomes something more than just a footnote in history.

Regards,
SB
 
UK blocked which is an easy out, and I found this to lack vision and leadership when compared to the solution forced by EC/EU.
When I read the CMA's responses, I felt like I read someone who said I didn't really know what the right answer was, and I don't want to mess up the largest merger case in the history of the world, so better off just blocking it and taking the safe road.

I'm going to have to disagree with you there good-buddy. I found their decision to be a bright spot in how different governmental regulatory bodies [should] work, and not this perceived lockstep method that these regulatory bodies should be following. CMA gave Microsoft plenty of chances on delivering something beyond a 10yr promise, but as you stated, "MS should be giving away as little as possible." Something that the CMA has serious issues with.
 
I'm going to have to disagree with you there good-buddy. I found their decision to be a bright spot in how different governmental regulatory bodies [should] work, and not this perceived lockstep method that these regulatory bodies should be following. CMA gave Microsoft plenty of chances on delivering something beyond a 10yr promise, but as you stated, "MS should be giving away as little as possible." Something the CMA has serious issues with.
Every negotiation is like this. It's not something that should be used against a party. I negotiated my house the same way, the sellers kept asking for more and I set a hard price or I walk. And they gave me the house.

I've embedded the EU response above. Imo that's precisely the type of answer I was expecting. To flip something that would have concerns into pro competition.
It's very difficult to keep asking for something beyond 10 years. Every year beyond the 10th is additionally pointless, because no one can possibly predict the outcomes that far out. Giving someone an indefinite license may make no sense at all because there are licensed technologies and IPs within these games themselves. If a gun manufacturer wants to remove their gun from your game, but you signed an indefinitely long license, it's not something that MS can reasonably re-sign again.

If COD is paying for middleware - those middleware companies will now have income for life. The implications are quite large spanning, and 10 years is pretty significant time for contracts to be renegotiated at cheaper prices for middleware and IP patents, music, voice actors, actors faces, etc.
 
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One report from MLex includes a few interesting extra quotes from Margrethe Vestager (EU competition chief):
  • A 10-year commitment to license the developer's games catalog "significantly improves the conditions for the emergence of cloud game streaming."
  • Vestager said that "remedies will make [Activision's games] available for millions of consumers" in Europe, regardless of the operating system they use. "We think this is pro-competitive ... We think the remedies will kick-start this market."
  • "We end up with a different conclusion based on how we see the nascent cloud streaming market start," she said.
  • She said that her competition department officials conducted two market tests and received positive responses from cloud gaming services in the US and the EU, as well as European game developers and EU consumer groups.
  • She pushed back at the idea that the "behavioural" remedy accepted might be hard to monitor or enforce. A commitment to license all-comers for free was "very simple" and "not hard to monitor," she argued. Non-compliance would be obvious to anyone seeking a license.
  • She said that the difference between behavioural and structural remedies was a "gray zone" in the digital sector. "If you make a free license for 10 years, is that then a partial divestiture? Have you sold the game?"
  • Vestager also countered claims by the CMA that accepting the remedy was akin to regulating or tampering with a new and fast-growing market. She claimed it was "future proof," since the games will be available to cloud-streaming services regardless of their computer operating system or business model. It's not "prescribing anything."
 
I'm going to have to disagree with you there good-buddy. I found their decision to be a bright spot in how different governmental regulatory bodies [should] work, and not this perceived lockstep method that these regulatory bodies should be following. CMA gave Microsoft plenty of chances on delivering something beyond a 10yr promise, but as you stated, "MS should be giving away as little as possible." Something the CMA has serious issues with.
That's the point of negotiation, to not outbid yourself. I keep saying this but January 2022, nobody cared about the cloud. Microsoft was proactive with Call of Duty because that's where we all thought the hang up would be. 10 years is an eternity in business. Regulators from the EU took a stance on cloud gaming, Microsoft replied in kind. The EU is going to regulate Microsoft on this aspect of the deal. Most CEOS sign 1-3 year deals, most sports leagues don't go beyond 7 year guaranteed contracts, most collective bargaining for unions is 4-5 years, most commercial rental agreements are 5 years as are most lease agreements but 10 years isn't enough? Being that this is my daily world, I don't think most people really understand how long 10 years is in business. It is an eternity as I previously mentioned and Microsoft gave all these other companies a lifeline with that course of action.

The CMA's response is telling. Only hit dogs holler and they are howling.
 
Every negotiation is like this. It's not something that should be used against a party. I negotiated my house the same way, the sellers kept asking for more and I set a hard price or I walk. And they gave me the house.

I've embedded the EU response above. Imo that's precisely the type of answer I was expecting. To flip something that would have concerns into pro competition.
It's very difficult to keep asking for something beyond 10 years. Every year beyond the 10th is additionally pointless, because no one can possibly predict the outcomes that far out. Giving someone an indefinite license may make no sense at all because there are licensed technologies and IPs within these games themselves. If a gun manufacturer wants to remove their gun from your game, but you signed an indefinitely long license, it's not something that MS can reasonably re-sign again.

If COD is paying for middleware - those middleware companies will now have income for life. The implications are quite large spanning, and 10 years is pretty significant time for contracts to be renegotiated at cheaper prices for middleware and IP patents, music, etc.

I guess we can agree to disagree? But as I stated earlier, I can't fault neither decision, especially how they view or perceive their own respective markets in the coming years.
 
EC/EU found a way and it was quite a simple resolution imo.
UK blocked which is an easy out, and I found this to lack vision and leadership when compared to the solution forced by EC/EU.
I can see both sides here and can't really identify any as inherently better. Importantly, the issues some said the CMA was just bullshitting are identified as a genuine concern by all regulators, so either they are all bullshitting or keeping and eye on future market progression is a Good Idea worthy of regulation.

The CMA's position certainly isn't a soft-touch though. It'd be a lot easier to just go with behavioural remedies and not piss anyone off. Taking a strong stance is harder.

That said, the idea of the free licenses for cloud for 10 years seems appropriate to allow time for the market to evolve without MS having an bought-in advantage. The flat refusal to accept behavioural remedies seems too restrictive; I feel the CMA should have offered a better, workable solution for MS. That said, I don't know how the negotiations went. What MS offered, as little as possible to appease from their business perspective, wasn't enough. Maybe the CMA felt MS were setting up for a nice long-term victory happy to accommodate any cost and without a real interest in capitulating a bought-in advantage, have to be blocked as they only way to prevent this future.

Realistically, the AI will probably have enslaved us all in ten years anyway...
 
I guess we can agree to disagree? But as I stated earlier, I can't fault neither decision, especially how they view or perceive their own respective markets in the coming years.
I think we can. I guess my point is, CMA could not have requested a term longer than 10 years for streaming. It's not something that ABK may even do for their own titles once licensing is involved. It's the reason Forza's go away on the store and only those with the remaining hard copies can still play it. I suspect if they asked for more than 10 years, MS would have to decline on the basis of it not being logistically possible is where I'm thinking.
 
The point of regulation is for the benefit of consumers ultimately. EU saw an opportunity to take something cough "valuable" and instead gave it to everyone. UK decided to block it and leave it to chance in hopes that more consumers benefit from it. I think the prior is the right move and it shows that they are trying to grow the gaming industry in doing and leveraged this opportunity to do so, at Microsoft's cost.

And that's fine. I don't see an issue with it, except as a MS shareholder, I hope this merger plays out for them. I don't agree that they are worth 70B, but I also didn't think Minecraft was worth 2B either and they were indeed correct. So I hope I'm wrong, but we will see.
Except it doesn't actually benefit the consumers in the console market because we are still looking at a duopoly of Nintendo and Sony with MS a distant third. That is the market with hundreds of millions of gamers.

Sony likely has to ask for a license, like all other cloud providers, which would be automatic, so any user which purchased COD on PS5 could stream it via PlayStation Plus Premium tier IF Sony ever expanded to use PS5 Hardware AND allowed gamers to stream games they own. It's a little simpler if they were PS4 version purchased. But Sony still needs to move to allow PlayStation Plus Premium users to stream games they own.
But now what happens if the game isn't avalible on the playstation ? Lets say wow. If MS makes a native version of wow for the xbox and puts it on xcloud how exactly does it work for the playstation ? Does MS also have to allow it on psn ?

I get the stuff like geforce now because its basicly just remote access to a vm on a computer powerful enough to run the games and you log in with your existing information once inside the vm. But something like playstation now is different.


That is even before DLC/Microtransactions/battle passes. I am assuming on geforce now and these other platforms using the vm route that they wont get a cut of any of that. But I don't think Sony or Nintendo would be happy with something like that.
 
Except it doesn't actually benefit the consumers in the console market
The consumers are gamers. That includes those on PC and those streaming on TV and mobile. The console duopoly remains, largely because MS failed to compete in a difficult market for the third player where many others have also struggled. Although in the UK it's a triopoly and XB does well here.
 
I can see both sides here and can't really identify any as inherently better. Importantly, the issues some said the CMA was just bullshitting are identified as a genuine concern by all regulators, so either they are all bullshitting or keeping and eye on future market progression is a Good Idea worthy of regulation.

The CMA's position certainly isn't a soft-touch though. It'd be a lot easier to just go with behavioural remedies and not piss anyone off. Taking a strong stance is harder.

That said, the idea of the free licenses for cloud for 10 years seems appropriate to allow time for the market to evolve without MS having an bought-in advantage. The flat refusal to accept behavioural remedies seems too restrictive; I feel the CMA should have offered a better, workable solution for MS. That said, I don't know how the negotiations went. What MS offered, as little as possible to appease from their business perspective, wasn't enough. Maybe the CMA felt MS were setting up for a nice long-term victory happy to accommodate any cost and without a real interest in capitulating a bought-in advantage, have to be blocked as they only way to prevent this future.

Realistically, the AI will probably have enslaved us all in ten years anyway...

There is a key difference, however.

The CMA assumes that cloud will be the future of gaming or at least a significantly large part of it and this acquisition would harm it. The CMA assumes that the acquisition will harm cloud gaming competitors.

The EU assume that cloud gaming might never take off and view this deal as potentially the only way that cloud gaming becomes an actual sustainable market. The EU went to cloud gaming competitors and found that they are all or almost all in favor of the deal as it gives cloud gaming a chance to become a self sustaining market.

IE - For the CMA the acquisition destroys competition in a future market that doesn't exist but they believe will exist. For the EU, the cloud gaming market doesn't really exist and might never exist but this acquistion gives cloud gaming the best chance to actually become a viable market.

Regards,
SB
 
which shows MS's true strategy. 10 years for one or two games is insufficient both in time and amount of games
One or two? Doesn't it state "All current and future Activision Blizzard games"? I guess the definition of "current" is up for debate, but by my count there are over 20 Xbox 360 games available as BC games on Xbox One. That might means any cloud provider could license those games for free as well.

This also means that Microsoft's own cloud service may begin allowing people to stream games they purchased and not just games on Gamepass.
 
One or two? Doesn't it state "All current and future Activision Blizzard games"? I guess the definition of "current" is up for debate, but by my count there are over 20 Xbox 360 games available as BC games on Xbox One. That might means any cloud provider could license those games for free as well.

This also means that Microsoft's own cloud service may begin allowing people to stream games they purchased and not just games on Gamepass.
I might have missed that

But thats something that MS wasnt willing but forced to sign still.
 
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