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

[see colon]

If MS turns around to the UK (which is somewhere between the 5th and 7th largest economy in the world depending on the day of the week) and says "stuff you, we're not willing to be regulated. If we can't do what we want we're taking our ball home", then everybody else will take notice. The EU, all EU members, etc. and if they have any sense the US too. That's a lot of GDP, and prime government pork to be putting at risk for some video games.

It doesn't have to be like this, though. If this deal is blocked, but Activision still wants to sell to Microsoft, wouldn't it only require Activision to remove itself from UK territories to avoid regulation? Activision would have to do this before acquisition, meaning it isn't Microsoft circumventing regulation, but Activision.

Regardless, I don't think Microsoft would necessarily have to fully pull out of the UK to have an impact on UK politics or regulation. They could simply stop investing in the UK, and perhaps move some of their UK studios to neighboring countries. We've just seen Disney change course on invenstments in Florida because of a feud with that state's administration, costing the state construction jobs and future taxes. I won't pretend to be a Brexit expert, but aren't parts of or all of Ireland somehow both parts of the UK and EU? If the EU has approved the deal, and MS and ABK move to Ireland, would they have both regulatory approval and guaranteed access to the UK market from the Belfast agreement?

Also, it isn't just other governments that are watching, it's other industry as well. We've already head statement coming from Microsoft claiming that the UK is closed for business. It isn't hard to think that other companies might think twice before setting up shop there, if they think they can get less regulatory scrutiny elsewhere.

 

[Deleted member 11852]

What if they have to stop investing in the UK so they can purchase a multination video game publisher?

When you look at what Microsoft make from enterprise, it dwarfs what they make from gaming. Xbox finances don't figure in Microsoft's financial reports because that business just doesn't figure on Microsoft finance radar.

Discussion that occasionally takes place, mostly from one person, about Microsoft pulling out of certain markets because they are unhappy with one decision, when balanced with their whole enterprise business, is utter nonsense. The UK Government relies on Microsoft for a lot of solutions but Microsoft aren't the only provider of those solutions. Like a lot of counties, who are not keen are becoming reliant on one suppliers for anything, the UK has been adopting a lot more open and alternative options for IT solutions.

Ten years ago everybody used Windows and Office, but there has been widening divorce with Macs and even linux being an option in many departments. I've been using a Mac in government since 2016 and whilst we use Windows/Macs and Office, other departments have embraced Google's offerings.

If Microsoft throw a strop to the degree that they pull out from a massive economy, first that will impact Microsoft financially more than it will impact the UK, second it will send a message to evert other country relying on Microsoft for their IT systems to begin divesting reliance on Microsoft.

 

[eastmen]

It doesn't have to be like this, though. If this deal is blocked, but Activision still wants to sell to Microsoft, wouldn't it only require Activision to remove itself from UK territories to avoid regulation? Activision would have to do this before acquisition, meaning it isn't Microsoft circumventing regulation, but Activision.

Regardless, I don't think Microsoft would necessarily have to fully pull out of the UK to have an impact on UK politics or regulation. They could simply stop investing in the UK, and perhaps move some of their UK studios to neighboring countries. We've just seen Disney change course on invenstments in Florida because of a feud with that state's administration, costing the state construction jobs and future taxes. I won't pretend to be a Brexit expert, but aren't parts of or all of Ireland somehow both parts of the UK and EU? If the EU has approved the deal, and MS and ABK move to Ireland, would they have both regulatory approval and guaranteed access to the UK market from the Belfast agreement?

Also, it isn't just other governments that are watching, it's other industry as well. We've already head statement coming from Microsoft claiming that the UK is closed for business. It isn't hard to think that other companies might think twice before setting up shop there, if they think they can get less regulatory scrutiny elsewhere.

A lot of people on this forum like to ignore inconvenient facts like the Disney/Florida issue because it doesn't support their narratives. Disney is far more reliant on Florida than MS is on the UK. Disney can't just detach spaceship earth and roll it down the high way to Georgia and set up their theme parks there and yet Disney is still removing investments from the State. It's funny how Disney is actually doing what I've proposed Microsoft could do but certain people continue to ignore real world examples.


Look at the end of the day for the UK to completely stop using MS products would cost them billions if not tens of billions. It could also be a nightmare for infostructure if say the trains are using an older form of windows and programs that only work on feature sets designed around those versions of windows and other programs that only run on those versions of windows. It's a lot different to say sure lets use linux and lets use open office so this dude in a random office can make slide shows for our next budget. It's another thing to say oh lets switch over to linux and have some people quickly write air traffic control software to run on it and hope the planes land , oh and then it all needs to work with the existing software that already runs on windows cause of course every other country in the world will continue to simply use what works instead of moving to this new random untested thing.

For Microsoft if the UK said no to this deal because of cloud gaming what other purchases will microsoft be blocked on by the UK. So while certain people will say oh its just a video game company , next time it may be something vital for MS and as it is they already feel that purchasing ABK will help them create an app store for mobile devices that will better compete with Apple and Google. So if MS doesn't figure out a way to make the purchase happen then they might never get another purchase passed in the UK.

For the UK you don't want to have one of the largest companies in the world reluctant to do business with you. Sure MS might be happy enough to continue selling the UK copies of windows and office but they aren't going to build new studios in the country or make any investments in it that aren't vital.

So at the end of the day the most likely thing is they will figure out a compromise. Now of course if the FTC finds a way to win and the UK and USA have both blocked it then the deal will certainly fail

 

[SmooTh]

https://committees.parliament.uk/publications/40218/documents/196404/default/

 

[eastmen]

https://committees.parliament.uk/publications/40218/documents/196404/default/

Eh nothing really big in that. Typical we didn't do anything wrong. I do find it interesting to note they were willing to give some exact numbers on how many times they met with the FTC and EU but no exact information on how many times they interacted with MS or ABK

I committed to follow up with the Committee in particular on a question raised aboutthe number of “oral and written” contacts between the FTC and the CMA in relation tothis case. Between the start of the CMA’s Phase 2 inquiry on 15 September 2022, andthe publication of its final report on 26 April 2023, the CMA had approximately 26meetings (including calls and virtual meetings) and exchanged (i.e. sent and received)approximately 74 emails with the FTC (including administrative emails to arrange thecalls) in relation to this case.2 Searches are still being conducted, and we will updatethe Committee as soon as this process is complete; but we do not expect the finalnumbers to differ materially from those presented here.

vs

Before reaching a final decision, we consider the merging parties’ written responsesto our provisional findings and any remedies notice, as well as those received fromother interested parties. We hold a response hearing with each of the merging parties,where we discuss their views on our provisional findings and any remedies proposals.If we still have concerns, we share a working paper with the parties containing adetailed assessment of the different remedies options and setting out a provisionaldecision on remedies. We invite comments from the merging parties on this workingpaper and consider their written submissions. Again, all these steps were followed inthe Microsoft/Activision merger investigation, and the merging parties engaged withthese.In some cases, such as this one, we hold additional calls or meetings with the mergingparties to discuss different aspects or possible modifications to their remedy offer. It isonly after this extensive engagement on the substance of our decision and potentialremedies, and shortly before our statutory deadline for publishing our Final Report,that we finalise our engagement with the parties and proceed to a decision.Overall, our process provides for close and continuous engagement with mergerparties throughout the investigation. There was no departure from our usual practicein this case, and the parties benefited from the full scope of engagement and legalprotections provided for in our merger investigation process

 

[SmooTh]

New Zealand delayed the decision again until July 17th

 

[JPT]

I'd surely agree with you if it was multiple countries. But its just UK and it wont require MS to leave the UK.

It's not the point if it's 100 countries or just UK. What you are suggesting is that you manoeuvre yourself around what the country deems is correct. It's their country it's their laws. Unless we should invade UK to impose our ideals and laws on them.
I am quite sure others will bend over backwards to take up any slack that MS leaves, and for the UK it would just be one transition, they are country not a corporation, they will endure such transitions again and again and again, painful or not.
If MS does end up manoeuvring around then UK can manoeuvre back and say, nope or just levy some new tax, after Brexit they are even freer to do crap like that.

 

[eastmen]

It's not the point if it's 100 countries or just UK. What you are suggesting is that you manoeuvre yourself around what the country deems is correct. It's their country it's their laws. Unless we should invade UK to impose our ideals and laws on them.
I am quite sure others will bend over backwards to take up any slack that MS leaves, and for the UK it would just be one transition, they are country not a corporation, they will endure such transitions again and again and again, painful or not.
If MS does end up manoeuvring around then UK can manoeuvre back and say, nope or just levy some new tax, after Brexit they are even freer to do crap like that.

Is that not what Disney is doing ? Moving it self around state laws ?

I am not implying that MS should invade anyone but a person and a company should be able to do business with whoever they see fit to do business with. Doesn't matter if its the USA or UK or India or what have you. Brexit did a number on the UK and I doubt anyone in the UK wants to do that again. The UK also wants to become the Silicon Valley of Europe. Doubt a lot of companies want to do business in a country that will block them from being more competitive in established markets because they have market share in a tiny segment of another market. Other companies have already signaled that and the UK is freaking out. That is why their messaging is trying to fall over itself stating they let other merges go through before. They are afraid that investment is going to leave

 

[see colon]

It's not the point if it's 100 countries or just UK. What you are suggesting is that you manoeuvre yourself around what the country deems is correct. It's their country it's their laws. Unless we should invade UK to impose our ideals and laws on them.
I am quite sure others will bend over backwards to take up any slack that MS leaves, and for the UK it would just be one transition, they are country not a corporation, they will endure such transitions again and again and again, painful or not.
If MS does end up manoeuvring around then UK can manoeuvre back and say, nope or just levy some new tax, after Brexit they are even freer to do crap like that.

This cuts both ways, though. Microsoft has already stated that they feel as though they are treated unfairly, and that the "UK is closed for business". So if they circumvent the CMA's block, and the UK enacts some new tax for Microsoft, that only proves Microsoft's point that the UK is treating them unfairly. How are other companies going to view that? Is it going to be useful to future investment and competition within the country?

 

[Johnny Awesome]

It's UK's right to block and MS's right to leave.

With that being said, I think it's a shame that the CMA is acting ideologically instead of in the interest of UK consumers.

 

[eastmen]

It's UK's right to block and MS's right to leave.

With that being said, I think it's a shame that the CMA is acting ideologically instead of in the interest of UK consumers.

well we have to see how it plays out. Apparently NZ and another company were also sharing info with the CMA and FTC. I have a feeling NZ is delaying to see what happens to the FTC and CMA.

 

[iceberg187]

https://twitter.com/x/status/1666375616336199680

 

[GhostofWar]

https://twitter.com/x/status/1666375616336199680

I'm glad the talk about this seems to be happening, it would be good if this deal ends up having an effect here regardless of how the deal ends up panning out. The image in that tweet talks about how the publisher gets it's share when you buy the game and the streaming service gets paid from your sub to their service, logical all makes sense.

The talk about ingame transactions also seems straight forward to me, Your running the game on the remote server/vm so when the game bills your payment method or you add a currency code that's all happening on the games backend servers and shouldn't be tied to the streaming service at all right. So the publisher running the game gets all the mtx revenue but the streaming service still gets all it's subscription revenue right so everyone gets their revenue again. It seems pretty logical to me, i'm not understanding their question there. If your game is running through ms store/steam/epic whatever, your going to be giving them a cut of mtx when they play locally just like when streaming.

Unless they are expecting companies to make streaming versions of their game that run natively on different operating systems and thus wont run through a store front and don't have the actual mtx store built into the game they should have the same mtx revenue coming to them they would in none streaming scenarios?

I'm not sure how to go about the console situation, they are closed locked down ecosystems and even if they did do something that let streaming services link accounts (portal 2 kinda proved this is a possibilty any not impossible) there could be issues with something like the latest playstation exclusive just not working on your streaming service because they can't run a native ps5 program and there is no other version yet. Not sure how to fix that or if it should be given a pass by regulators, this ones above my pay grade.

edit: just a quick edit to say I couldn't read the actual report because it's behind a paywall, so if they talk about any of this in the full report I couldn't read it.

 

[Shifty Geezer]

It's UK's right to block and MS's right to leave.

With that being said, I think it's a shame that the CMA is acting ideologically instead of in the interest of UK consumers.

What determines what's right (for consumers) is ideological. Allowing the merger and big companies to get bigger is also ideological.

 

[BoardBonobo]

I like how in all of this they are assuming that the conumer would be happy to only ever purchase a license for a game, and never the game itself. Turning gaming into streamed service like music or films. It's inevitable for companies like Microsoft to push us into consuming product with out ever owning it, theres's a lot more profit in that. But it will be a sad day when that happens.

 

[chris1515]

CMA met with FTC 26 times to discuss Microsoft-Activision merger, CEO Sarah Cardell says

UK regulators at the Competition and Markets Authority (CMA) met with the FTC 26 times to discuss the Microsoft-Activision merger, CEO Sarah Cardell says.

www.tweaktown.com

CMA met with FTC 26 times to discuss Microsoft-Activision merger, CEO Sarah Cardell says

Read more: https://www.tweaktown.com/news/9176...sion-merger-ceo-sarah-cardell-says/index.html

 

[Malo]

The talk about ingame transactions also seems straight forward to me, Your running the game on the remote server/vm so when the game bills your payment method or you add a currency code that's all happening on the games backend servers and shouldn't be tied to the streaming service at all right. So the publisher running the game gets all the mtx revenue but the streaming service still gets all it's subscription revenue right so everyone gets their revenue again. It seems pretty logical to me, i'm not understanding their question there. If your game is running through ms store/steam/epic whatever, your going to be giving them a cut of mtx when they play locally just like when streaming.

That's not necessarily how some companies want to operate though. Apple for example would never allow publishers to reap 100% of in-game microtransactions. Microsoft definitely will want a piece of that pie and ensure they do by having all their cloud services run through game pass.

Nvidia operate a subscription only cloud service, they do not interact with the games shops.

I'm not sure how Sony's cloud services run, I'm fairly sure they're the same concept as game pass.

 

[GhostofWar]

I like how in all of this they are assuming that the conumer would be happy to only ever purchase a license for a game, and never the game itself. Turning gaming into streamed service like music or films. It's inevitable for companies like Microsoft to push us into consuming product with out ever owning it, theres's a lot more profit in that. But it will be a sad day when that happens.

That's really all your doing/getting when buying anything digitally and physical is really only a console thing now and even that's on borrowed time. So when they are saying buying a license in this sense they are basically meaning buying a game digitally, with the downside at the moment being a publisher can then turn around and make geforce now, boosteroid, shadow, plutopsphere etc not let you play that game on their streaming service even if you have a game/license on a linked account.

 

[Silent_Buddha]

I like how in all of this they are assuming that the conumer would be happy to only ever purchase a license for a game, and never the game itself. Turning gaming into streamed service like music or films. It's inevitable for companies like Microsoft to push us into consuming product with out ever owning it, theres's a lot more profit in that. But it will be a sad day when that happens.

So, basically like all PC gamers, all mobile gamers and over 50% of console gamers? Almost everyone just purchases a digital license now. There's still some holdouts on console that buy physical copies of a digital license but even then it's still just a digital license. So I guess that means 99%+ of PC, console and mobile gamers are already doing what you suggest without "companies like Microsoft" having to do anything?

Hell, some physically distributed versions of games won't even work without first downloading a day one patch which means the physical copy only serves to save a little on download bandwidth.

Regards,
SB

 

[Nesh]

So, basically like all PC gamers, all mobile gamers and over 50% of console gamers? Almost everyone just purchases a digital license now. There's still some holdouts on console that buy physical copies of a digital license but even then it's still just a digital license. So I guess that means 99%+ of PC, console and mobile gamers are already doing what you suggest without "companies like Microsoft" having to do anything?

Hell, some physically distributed versions of games won't even work without first downloading a day one patch which means the physical copy only serves to save a little on download bandwidth.

Regards,
SB

we have the option to choose which is power to the consumer. 50% is still a large number. None of my physical games need a digital license to play. Unless I am not aware of it. Which would be bad if true because its one thing for the consumer to know and consciously making the choice and another to not knowing what he really purchased.