Microsoft acquired Activision Blizzard King for $69 Billion on 2023-10-13
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Pretty good arguments against MS; but equally MS’ counter points were better imo. At least reading that article, when I finished I found myself in MS favour to continue.
There are concerns, which I think are legitimate, and they addresses them head on imo. An interesting stat is that if all COD players left for Xbox, Sony would still be the largest platform really says a lot.
I would agree from that point alone, Sony would survive COD leaving PS, but it won’t be happy about it’s financial reports for the quarters following.
edit: and ouch
"“Sony engages in conduct today which is reflective of its market power in console gaming, including increasing prices of its consoles without fear of losing market share,”"
There are concerns, which I think are legitimate, and they addresses them head on imo. An interesting stat is that if all COD players left for Xbox, Sony would still be the largest platform really says a lot.
I would agree from that point alone, Sony would survive COD leaving PS, but it won’t be happy about it’s financial reports for the quarters following.
edit: and ouch
"“Sony engages in conduct today which is reflective of its market power in console gaming, including increasing prices of its consoles without fear of losing market share,”"
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Metal_Spirit
Regular
I really do not agree with this sentence, and also find it very deceptive and misleading.
Prices are increasing everywhere, and does that means that companies are not afraid of loosing market share?
I would say that keeping prices down, something that not all can do, shows a possibility, due to strong financial capacity, to gain market share due to price increases. But rising prices does not show a lack of fear in loosing market share..
Besides that sentence completly ignores the market reality. Playstations are not easy to find, and scalpers sell them at 700 ou more euros. Since consoles are selling at those prices, a 50 euros price increase in a market lacking consoles should not affect sales in any significant way. And as such why not do what everybody is doing, and increase price to compensate for rising costs of production without taking a loss?
As I said before, I see the not increasing price move an oportunitty to gain market, but although a price increase could, and should, affect sales, I do not see it as a "lack of fear of losing marker share".
That really doesn’t fall in line with supply demand economics however, and increase in price always decreases demand. They have hiked both game and console units moving into this generation. It goes to show how much control they have over the console market which runs contrary to their point of losing the console market if they lose COD.
If there is that much pressure to keep their market share, then they wouldn’t increase their prices. It shows that MS is not a relevant competitor to them in a very price conscious industry. MS has not moved pricing which shows how badly they need to keep prices down to continue to even compete.
You cannot say you will lose the market because of losing cod, when you are both the industry leader by a long shot and set whatever prices you want and not have any repercussions on numbers. The 2 don’t align. COD cannot simply be the “market”.
It’s pretty obvious at least for me, the points put forward by Sony and the counter claims by MS, are really about Sony not wanting any competition at all.
TLDR; Sony put forward that they will lose market share as a result of COD gaining exclusive benefits on MS platform. And yet the many moves around pricing would also do the same thing, but apparently they don’t care about that. It doesn’t make sense.
It’s about the fact that Sony would actually be impacted by this deal. And that should be OK. It’s okay that their market dominance could be harder to maintain. It’s okay that they are impacted by this deal. Those are precisely fair competition rules. But it’s not okay if you’re going to get a monopoly.
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Metal_Spirit
Regular
I'm not disagreeing with you.
And I was not talking about COD, but just about the phrase itself.
About COD, Sony cannot say for shure, nobody can say for shure. But COD is a game that drags sales in the millions, and I've seen posts on fóruns of people claiming they sold the PS5 and got an Xbox because of COD.
Nobody can say for shure those posts are real, and even less that the losses would be small or big.
What we cannot denny is that the risk is real. And that's why regulators are concerned.
But there is one thing I must say about this. There was never anything stopping Microsoft from competing in equal terms with Sony and being Market Leaders.nif Microsoft had invested in gaming and in their studios, it could be market leader and it always had the financial capability for that.
If it is not I cannot say it is because of Sony beeing special, but because of Xbox constantly screwing up.
Because of this, eventually becoming market leader by purchasing others, is something I do not like. It's forcing it's position on a market without ever deserving the position.
But this is just a personal opinion. And I think the aquisition should go through, since otherwise that would be a present in Sony's hands.
What I do believe is that for fairness, the aquisition should be well analised and eventually, if found needed, regulated, only advancing if all regulators fears are appeased.
After all, as I said, Sony fears can be just that, fears. But regulators must take into account that if they fail, since the risk is indeed a possibility, the market may be screwed up.
I think the regulators are showing their hand here. Sony is doing their best to downplay their market dominance and are overplaying MS position in the market which for some reason they are agreeing to.
Competition requires investment, and even then there is risk it's nearly impossible to cause any damage done to incumbents.
For example: MS spent hundreds of millions on Mixer going so far to pay to poach the top streamers off Twitch to Mixer. This is the amount of investment they pushed to move the needle. The net result was that Twitch's hold of the market ensured that nothing changed for Mixer. Mixer would go bankrupt.
Fast forward a year, now Twitch is pushing a 50/50 split with creators with no competition in sight, now everyone is saying MS quit on Mixer too early. That Mixer should have been around. Well, that's the cost to break into the industry and they got no movement on the needle. Twitch didn't have to do a single thing to innovate, and now with monopolistic control over the market, they can 'increase prices' by changing the split and creators have no where else to go.
MS has put forward millions of dollars for a variety of changes to the status quo in the console industry:
a) they made 2 consoles from the get go
b) they had to make them smaller and cheaper than their competitor while being technically larger in silicon
c) they had to make game pass
d) they had to push on dolby vision
e) they made xcloud using series console chips
f) they've made all their first party releases day one on game pass
g) they have discounts of $1 to join gamepass
h) they still allow you to convert gold to game pass ultimate, THEY even have a FAMILY PLAN now To make it even CHEAPER!
i) they are buying up studios to bolster their first party
j) not once increased their prices in an official manner, except that one time in which they immediately backed off and made F2P also free on XBL.
k) They made BC for OG Xbox and 360 Titles!
l) They made a better 4K console that also played ENHANCED BC titles (in 2017!)
m) All of those titles are still BC all the way up to the latest console with even further enhancements all for NO charge!
X) Even after Xbox dominated with 360 with a cheaper price point and releasing earlier with great first party lineups and COD marketing exclusivity, they still lost to PS3 by the end of the generation.
All of this is investment to compete with Sony. The number of hundreds of millions cannot be understated and they are barely making a real dent on Playstation.
And Sony is now complaining that MS should they get COD, will cause the market to flip in their hand. This isn't about Sony losing the market if they lose COD, they are basically saying 2 things
a) if they do not have exclusive advantages over COD they cannot compete with MS (and this is bullshit)
b) reading between the lines: they unwilling to compete. They don't want to change their business model, they want to be super dominant without doing anything at all.
They are unwilling to invest the amounts of money to compete like MS has to make a better product for consumers. It's hard to see it any other way. Look at how much has been invested by MS here after coming off the largest loss in XBox. They continue to compete and they continue to invest to innovate and make the market better for consumers.
Everyone calls game pass unsustainable. Congrats, that's the cost of competing. To move the needle just a bit in their direction. That's the cost of xcloud, that's the cost of all the things MS has had to invest to compete with incumbent leader and rival Sony. And what has Sony done to counter the above? Raise prices on games. Raise prices on consoles. Provide better customer services to those who pay the premium sub models. No cloud gaming investment, no game pass. No BC. No enhancements. Do their best to bugger up and slow down cross platform multiplayer. They lied about all their next-gen titles being on PS5 only because of hardware reasons, only to release them on PS4.
If regulators aren't looking at this, in this fashion, what are they doing really other than protecting leadership positions?
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Even if MS pulled cod from playstation , Nintendo doesn't have cod. Wii was the market leader with 100m units sold vs 87.4m ps3s . The wii u was a failure but with the switch they have sold 111m vs the 118m of the ps4 . They did all this without real cod releases ( I think the wii had some janky ones)
I find it appalling that the EU is willing to protect Sony's market share to this extent. A more even market share would produce better results for the gaming public.
I guess sony is affraid of MS pulling a sony here.
I find it appalling that the EU is willing to protect Sony's market share to this extent. A more even market share would produce better results for the gaming public.
I guess sony is affraid of MS pulling a sony here.
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Metal_Spirit
Regular
One point of view...
There are others...
But I do not defend any of them, so I will not enter a discussion here. That would passa the ideia I was defending the other view, and I am not.
All I say is that I do not know who is correct, and as such, I defend that regulators should raise questions and analize things with due care.
There is always two sides to a coin...
There are others...
But I do not defend any of them, so I will not enter a discussion here. That would passa the ideia I was defending the other view, and I am not.
All I say is that I do not know who is correct, and as such, I defend that regulators should raise questions and analize things with due care.
There is always two sides to a coin...
Microsoft accuses UK regulator of ‘adopting Sony’s complaints’ over Activision Blizzard deal | VGC
The UK's CMA recently expanded its inquiry into the proposed acquisition…
www.videogameschronicle.com
I found this really interesting
There were 280 first/third party exlcusive titles for Sony in 2021 about 5 times what was on xbox. Should the UK be more concerned about that vs the 2-3 yearly Activision/blizzard releases ?
And this here is true. Sony entered the cloud gaming market almost 10 years before Microsoft did. Sony bought 2 companies and ate up the almost non existent competition and squandered almost a decade lead over microsoft in the market. Why should consumers be worried about protecting a company that doesn't actually innovate. Sony has been dragged kicking and screaming into every new feature. The company really innovating in the console space is MS and it has been them for a few generations now
This is going to end up biting sony in the ass with regards to future acquisitions . Since 2018 they have bought aduiokinetic , insomniac , housemarque , nixxes , firespite , fabrik , bluepoint valkyrie , lasengle , haven , bungie and savage games. All of these will be producing exclusive sony content.
Ars Technica story on Microsoft's response to the UK regulator.
arstechnica.com
So MS is saying even if they acquire Activision and pull COD from Playstation, Sony isn't necessarily going to be hurt by it because they've been so successful in the past and there's a diversity of games out there and besides it's overstating the importance of COD and Activition games.
It seems like MS could pledge to continue releasing COD on Playstation to shut down claims that it would use the acquisition for competitive advantage at the expense of consumers. In fact a settlement with the UK regulator could involve some kind of an agreement not to pull Playstation support.
It's interesting that MS says they plan to make COD available to "more gamers in more ways" but doesn't make a simple promise. Only that they will answer the CMA's questions, but presumably not make any kind of compromises?
Microsoft fights to save Activision merger, says Sony protest is “self-serving”
Microsoft says UK relied on Sony’s “exaggerated” claims about Call of Duty.
arstechnica.com
So MS is saying even if they acquire Activision and pull COD from Playstation, Sony isn't necessarily going to be hurt by it because they've been so successful in the past and there's a diversity of games out there and besides it's overstating the importance of COD and Activition games.
It seems like MS could pledge to continue releasing COD on Playstation to shut down claims that it would use the acquisition for competitive advantage at the expense of consumers. In fact a settlement with the UK regulator could involve some kind of an agreement not to pull Playstation support.
It's interesting that MS says they plan to make COD available to "more gamers in more ways" but doesn't make a simple promise. Only that they will answer the CMA's questions, but presumably not make any kind of compromises?
Playstation is probably Sony's most important source of revenue and still doesnt generatexas much profits as MS collects from Windows. MS has the luxury to keep prices low that Sony doesnt have. Sony is not selling as much software as it used to due to limited supplies. The price increase has nothing to do with exploiting market power, but rather trying to compensate for whats its losing from missed software sales.
In addition, the limited supply in the market keeps both new consoles on similar sales, with Sony losing market share from the new generation.
Imagine a special market case like this one combined with ex-multipltaform games being released on the XBOX as exclusives at the same time. The market can easilly shift, without MS offering anything necessarilly better.
Sometimes protecting corporations also means protecting consumer choice as well counterintuitively speaking ...
I don't think Microsoft would be having as many difficulties with regulators here as they do now if they had just kept releasing content with existing multiplatform franchises or much less content in general from traditionally multiplatform publishers on their competitors platform. All Microsoft has done with these recent acquisitions is take away consumer choices so had they shown a different behaviour, they might've been be able to secure approval from regulators more easily ...
The purpose of the regulation is to assist consumers not the corporations, to ensure there isn't a monopoly so that the consumers are not affected by the lack of choice.
There's sufficient evidence that Sony can completely and will utterly survive COD moving to Xbox, whether it goes 100% exclusive or not, and MS has already agreed _not_ to.
The whole point is that Sony _doesn't_ want to even try to compete, thus consumers aren't benefitting with Sony being the market leader. Sony has, from what I understand over 250+ exclusives, this merger would bring MS 10 more, still easily over 150+ exclusive titles behind. It is unfathomable that this entire argument banks on a single franchise called Call of Duty. There was a point in time during the 360 era where MS had ownership of both Halo and Gears and Call of Duty, when they were at the top of its game and PS3 still won that generation. That is the level of brand loyalty that follows playstation. They could do everything wrong an entire generation and XBox would only actually be able to compete.
There is sufficient choice in the FPS market, and if COD ever went exclusive, there are tons of other FPS titles that would be more than willing to take up that mantel.
While I understand the concern, the counter points are significantly stronger.
Metal_Spirit
Regular
That is not what is happening! They do not exist to attack or defend any part, and they will not do that, and if they o happen do defend Sony it´s because they find that the aquisition causes concerns about their concept of a sane competition. If they defend Microsoft, it's because they found no reasons for their concerns.
We cannot see their position, and questions, and think they are pro Sony or pro Microsoft depending on what they are inquiring, or if they aprove or reject the aquisition.
I do find it odd that people are capable of thinking they are defending some of the interested parts. It seems like some kind of fear that they might take a position against his favorite console brand.
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