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

It's not a "phase 3 review", there is no such concept in the CMA's legislation or process. This is a partial revisit of risk assessments in the phase 2 review following a couple of key changes in circumstances: 1) Sony signing a deal with Microsoft, and 2) Microsoft committing to address CMA concerns on the cloud.

More importantly, this isn't news unless people missed the CMA's published letter on 14 July, which followed the final CAT hearing. We're now just over half-way through that period and nothing new has been released, which is promising!
 
That "some margin" is significant, though. Steam take 30%, right? That means for every 7 games sold on Steam, Activision's cut is the same as 5 copies from a storefront they take 100% from.

That's true, but their PC sales also went into free fall after they removed them from Steam. Sure they got higher margins by keeping that 30%, but they also lost quite a bit of sales. From what I heard from a friend of mine, sales for the PC version dropped by over 50% in the following years.

Regards,
SB
 
So if they sold 10M copies at 60 USD per piece that means there is an income of 60M. 30% goes to steam, so that is 20M to steam. And they end up with 40M.
If they sell 5M copies at 60 USD per piece that means an income of 30M, no steam tax ie they have an income of 30M.

Looks like selling on steam is a no brainer, but is it? When you break down the cost of that 60 USD, does the publisher have a 30% margin to "give away".
I mean if the profit for the publisher on that title is 25% of the 60USD. That means that the publishers share is 15 USD. But steam still wants its 20 usd, is that not -5 USD per copy for the publisher to be on steam?
Now that 25% of 60 USD is just a pie in the sky number from me, but graph it out and see when you break even and make a profit after being levied by the steam tax*.
Also its the publisher taking the risk and not steam, so why should steam have more profits per copy than the publisher? What is a "fair" ratio between the publisher and the storefront.

*steam tax is generic, could be any storefront like MS, Apple, Google, Amazon etc etc
 
So if they sold 10M copies at 60 USD per piece that means there is an income of 60M. 30% goes to steam, so that is 20M to steam. And they end up with 40M.
If they sell 5M copies at 60 USD per piece that means an income of 30M, no steam tax ie they have an income of 30M.

Looks like selling on steam is a no brainer, but is it? When you break down the cost of that 60 USD, does the publisher have a 30% margin to "give away".
I mean if the profit for the publisher on that title is 25% of the 60USD. That means that the publishers share is 15 USD. But steam still wants its 20 usd, is that not -5 USD per copy for the publisher to be on steam?
Now that 25% of 60 USD is just a pie in the sky number from me, but graph it out and see when you break even and make a profit after being levied by the steam tax*.
Also its the publisher taking the risk and not steam, so why should steam have more profits per copy than the publisher? What is a "fair" ratio between the publisher and the storefront.

*steam tax is generic, could be any storefront like MS, Apple, Google, Amazon etc etc
Steam reduces it's take if the game sells well, I think it's 70/30 to 10 mil revenue, then 75/25 to 50 mil and then 80/20 after 50 million.
 
So if they sold 10M copies at 60 USD per piece that means there is an income of 60M. 30% goes to steam, so that is 20M to steam. And they end up with 40M.
If they sell 5M copies at 60 USD per piece that means an income of 30M, no steam tax ie they have an income of 30M.

Looks like selling on steam is a no brainer, but is it? When you break down the cost of that 60 USD, does the publisher have a 30% margin to "give away".
I mean if the profit for the publisher on that title is 25% of the 60USD. That means that the publishers share is 15 USD. But steam still wants its 20 usd, is that not -5 USD per copy for the publisher to be on steam?
Now that 25% of 60 USD is just a pie in the sky number from me, but graph it out and see when you break even and make a profit after being levied by the steam tax*.
Also its the publisher taking the risk and not steam, so why should steam have more profits per copy than the publisher? What is a "fair" ratio between the publisher and the storefront.

*steam tax is generic, could be any storefront like MS, Apple, Google, Amazon etc etc

This doesn't change things much, but 30% of 60 million is 18 million. :) You're thinking of 1/3 of 60 million. Close, but not quite the same.

Other things to consider for a game like COD. It's a multiplayer competitive game, so the online community is key to keeping players interested and new players buying it as the years go on. It's another reason that the PC version went into a death spiral after it was removed from Steam and before cross-play with consoles was enabled. Smaller community meant less interest. Less interest meant longer queue times. Longer queue times meant less people playing. Less people playing meant less interest. And that death spiral was getting worse and worse, only cross play managed to revive COD on PC to an extent. Putting it back on Steam seems to have fully revived it on PC.

Having it on other storefronts would help a bit as well, but at least with it being on the largest storefront, you're getting that large influx of players that weren't interested in buying it on a company storefront.

Regards,
SB
 
Well there it is

But I don't think they are selling off the rights. They are just licensing them as otherwise it would conflict with a bunch of other deals MS has made

“To address the concerns about the impact of the proposed acquisition on cloud game streaming raised by the UK Competition and Markets Authority, we are restructuring the transaction to acquire a narrower set of rights,” says Microsoft president Brad Smith. “This includes executing an agreement effective at the closing of our merger that transfers the cloud streaming rights for all current and new Activision Blizzard PC and console games released over the next 15 years to Ubisoft Entertainment SA, a leading global game publisher. The rights will be in perpetuity.”

Can't find out if its in all markets or just UK

But I guess the next step for MS is to close down abk studios and move them over to bethesda or obsidian to get around the new ABK stuff.
 
As far as I understand it it's the whole EEA not only UK.
The divestment will take place immediately before completion of Microsoft's acquisition of Activision. Ubisoft will also receive a non-exclusive licence for Activision's EEA cloud gaming rights to enable it to stream and sub-license streaming of Activision games in that region. At the same time, Microsoft will receive a non-exclusive licence from Ubisoft for cloud streaming rights to the extent necessary for Microsoft to fulfil its obligations under its commitments to the European Commission and certain existing third-party cloud streaming agreements.
 
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As far as I understand it it's the whole EEA not only UK.
Seems odd that the UK is able to force it through for all of Europe. They aren't part of the EU anymore.
The new transaction deals with streaming rights outside the European Economic Area, reflecting the fact that Brussels had already approved the deal.

Ubisoft will, however, receive a non-exclusive licence for Activision's European gaming rights too, enabling the French group to also stream the rights in the EU.

So it really doesn't speak about anything outside of Europe and UK.... guess we need to wait for clearer reporting
 
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Its good right? Ultimately it will make Ubi+ more attractive and a valuable alternative for GP, PS+, EA+ or whatnot. Everybody happy.
 
Its good right? Ultimately it will make Ubi+ more attractive and a valuable alternative for GP, PS+, EA+ or whatnot. Everybody happy.
maybe ? not sure how the cloud only rights to these games are going to bolster ubi+

Will abk games still be on xcloud ?

What happens if another company tries to purchase ubisoft. I'd assume it only be tencent since they own 49% but is there a clause in it for Ms to buy back the rights before its sold ?

Lots of details to still find out.
 
One questions for those who may understand a bit more about this than I do.
Apparently the CMA has putted an end to the ABK purchase, and the deal is dead forever.
However, Microsoft submited a new deal, wich is now beeing analised and on Phase 1.
This according to www.gov.uk.

My question is: If the deal is diferent, and the previous one is dead, shouldn´t all regulators across the world analise it?
After all, even if at Microsofts eyes, and even on CMAs eyes the deal seems better for thirds, and if all previous arrangements are kept, it is a different deal, and some parts, even if not willingly may create damages on thirds on some markets.

On my low undertanding on how this should work, if the other deal is dead... all comes back to square one! And all regulators analise things for their own market.
 
Seems odd that the UK is able to force it through for all of Europe. They aren't part of the EU anymore.


So it really doesn't speak about anything outside of Europe and UK.... guess we need to wait for clearer reporting
As part of this arrangement; Ubisoft still has to comply to the agreements MS made to EC. So technically this would only apply to UK, the EC one is global IIRC.

 
This is a global deal but excludes EEA due to existing agreements made for EU. Yes, Microsoft will need to license ABK games for use on xCloud in the US.

Tommy McClain
 
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