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

[Deleted member 11852]

^^^
Here. These are heavy implications.

Déjà vu! You and I have been here before, and just because you inferred that I was suggesting his YouTube video was around longer than he practised law does not mean I was implying it. I keep saying that his legal practising is not relevant. I'm only addressing the guy's commentary as somebody with a social media presence. I thought I made this really clear in my earlier post: "And by relevance, I don't see Richard Hong's legal qualifications or experience as important here - other than folks who may take his position as being meaningful for what he is commenting on"

You seem determined to establishing his credibility but I don't know why. I regret humorously (intended at least) asking if he had any clients. I didn't intend for this to trigger people.

Where, in any of the documents submitted, indicate that acquiring Activision Blizzard will result in the closure of Activision Blizzard. The regulators need to regulate what will happen to the competition in this case: ie Sony and others. Sony needs to prove, according to Sony's arguments, that the entire gaming industry will collapse as a result of MS acquiring Activision Blizzard. He feels its ridiculous, (myself included), you feel this is valid? If he disagrees with Sony's statement here, he doesn't understand UK/European legislation?

I think think you've misconstrued something. Nowhere does Sony, the UK CMA or the EU suggest that Microsoft intend to close Activision-Blizzard, the point is that Microsoft have so much money that writing off billions of investment isn't going to hurt them. This is the counter-argument to the often made statement by Microsoft (repeated by posters here) that not releasing games on PlayStation, Switch or other PC storefronts would is not in Microsoft's commercial interested. Microsoft have chosen to not release Starfield and Elder Scrolls VI on PlayStation demonstrating that the company actually are willing to forego commercial opportunities when it gives their platform a competitive advantage. The only differences between Starfield, Elder Scrolls VI and other games is the X dollar amount.

Given the revenue outlook of games like Call of Duty are far below other investments Microsoft have happily written off, there is far less of a financial reliance on the commercial viability of acquisitions. I.e. they don't need this to be profitable. Your man has made this this same pointin one of his videos, but I cannot recall which because there are so many.

Economics is the science of studying business practices, production, alternative goods, and consumer purchasing behaviour - why is this irrelevant discussion?

I already said, the economics of an industry is not ralvent to the application of UK and EU merger and acquisition law. The only assessment is whether an acquisition impact the ability for competition.

Sony is making the argument that ownership of CoD would cause them to foreclose. That means consumers have absolutely no choice but to buy CoD because there are no substitute goods for it and they will go wherever call of duty goes. It's nonsense.

But that would be nonsense but I can't see such a claim by Sony, maybe you quote it? What I do see in the the UK CMA redacted release of Sony's document which - just like Microsoft's document - includes an exaggerated and self-serving account of the industry impact, is that Sony talk a lot of the possible foreclosure of particular business opportunities. PlayStation is profitable because of the culmination of many individual business opportunities. Call of Duty and cash cows like Elder Scrolls and GTA, which sell forever, represent a considerable chunk of those profits. Particularly MTX.

Hmmm, Call of Duty is on the Apple, Sony and Valve storefronts.

You mean the unrelated cash grab apps full of IAPs or the mobile apps to accompany the PC/console game or the actual PC/console Call of Duty games? I can't see any actual Call of Duty games on the iOS or Google Play stores.

I know that the CMA has made some comments about their concern that the acquisition may harm some of those companies, but I don't recall seeing anywhere that most of those companies actually raised any concerns. Granted, I didn't read the full CMA document, so perhaps that has documentation in it specifying exactly which companies have lodged formal complaints?

To let me recap. You don't recall any accounts of concerns in the document you didn't read? Ok.. To be honest, that's the most logical thing I've read in this thread for a long time.

 

[fehu]

Sony is using every opportunity to squabble with Microsoft.
Microsoft is offering gifts.
Sony says that Microsoft's gamepass is better.
Microsoft says that Sony's exclusives are better.
If I've learned something by the forced watch of romantic comedies, at the climax of their argument they will kiss and then get together.

 

[Deleted member 11852]

Sony is using every opportunity to squabble with Microsoft. Microsoft is offering gifts. Sony says that Microsoft's gamepass is better. Microsoft says that Sony's exclusives are better.

This, and cases like Epic vs Apple, are a rare opportunity to get a real insight into what companies actually think of their competitors, because to persuade a regulator or court they need to disclose so much candid opinion from their internal documentation.

It's clear that both both Microsoft and Sony's internal views are at odds with their public rhetoric, which shouldn't be a surprise to anybody but there do seem to be people who think these companies care about as gamers versus them as a revenue stream.

 

[see colon]

Microsoft have done a really good job keeping the comms about Sony and Call of Duty. It doesn't matter what regulators say at this point, people who just aren't interested in the truth will just lap up their corporate PR.

I keep hearing this. You keep saying this. And I know he doesn't work in COMP but he said that it's about COD on Playstation.

https://twitter.com/x/status/1590043081495412736

'It's all about COD on PS" isn't some thing only Microsoft are saying. Others are saying it as well. And as vocal as Sony has been about the deal, I have yet to see them put any weight behind any other argument. Everyone else listed as a competitor has been pretty silent about the deal.

 

[iroboto]

He puts out a lot of videos which begs the question, does this guy have any paying clients

"And by relevance, I don't see Richard Hong's legal qualifications or experience as important here - other than folks who may take his position as being meaningful for what he is commenting on"

You seem determined to establishing his credibility but I don't know why. I regret humorously (intended at least) asking if he had any clients. I didn't intend for this to trigger people.

Because technically no one would be qualified to comment on anything then in this case. He is a lawyer of higher standing than an associate, who specializes in M&A as well as Video Games as per his profile. This is an international M&A deal that also involves the FTC; if his commentary is irrelevant than every single lawyer's commentary is irrelevant as well, considering how few have ever worked with a merger of this size in the video gaming world. Such his experience and qualifications be considered irrelevant then everyone's POV here is irrelevant. The point of a discussion forum is to discuss, he brings value to dissecting the papers and media.
I think you are making a connection that people are anti-Sony because they follow watch his videos and listen to his arguments. On the contrary, I'm almost positive most people are finding Sony's statements laughable, and he's just providing confirmation bias that someone engaged in this sector also agrees with us. I don't see him as needing to convince anyone that the arguments provided by Sony are poor. I certainly did not need be swayed.

the point is that Microsoft have so much money that writing off billions of investment isn't going to hurt them

And we agreed many times ago that shareholders will not stand for losses like this. 70B is not simply something to just write off, the opportunity costs are enormous. The ABK deal has to go somewhere or have some sort of reasoning behind it in preparation for a far future in which this investment is worthwhile for MS to take onboard, which is the only reason this inquiry should exist, but that reason cannot be the monopolization of the video game market, it's far too small to make sense.

Microsoft have chosen to not release Starfield and Elder Scrolls VI on PlayStation demonstrating that the company actually are willing to forego commercial opportunities when it gives their platform a competitive advantage

And this is common practice in the video game industry. I'm not seeing the value here of this point since games that typically survive off their multiplayer base and season passes are required to be on as many platforms as possible, while single player titles typically are used as exclusives since population count has no meaning to the relevance of how long the game stays on the market. For precisely this reason alone, single player titles are often selected as GOTY, and multiplayer games are never nominated for this. GOTY titles bring people to your platform, but they don't necessarily make the most profit.

The only assessment is whether an acquisition impact the ability for competition.

The content industry as a whole regularly engages in exclusivity practices that impacts the ability for competition. As it stands today, due to Sony's leadership position, exclusivity and marketing rights are a fraction of the cost for them as they are for MS to purchase. MS is not interested in paying 2x the price that Sony has to pay to gain exclusivity rights for the same title, and in doing so, largely, the results are have been negative towards them (Tomb Raider) and does not net any real gain onto their platform.

but I can't see such a claim by Sony, maybe you quote it?

Highlights are mine.
This is their conclusion paragraph, meaning all their arguments leading up to this support this particular axiom. Sony's argument here is that the gaming ecosystem is being threatened, and my comprehension here is that means the industry.

They write "the only way to preserve" meaning there is no viable alternative to compete against CoD exclusivity, whether through marketing rights or not, when as we see their arguments as it stands, Sony owns such privilege over the franchise today - CoD is a degraded variant on every other platform other than Sony's. Precisely the arguments that Sony makes above that should MS be giving CoD, that players will run over to MS' platform. And yet, MS and Switch and PC continue to survive to this date, even though Sony has had controlling interests in the marketing rights and platform advantages over CoD for the better part of the decade and will continue through till 2023 or longer depending on how that contract was signed.

So all I'm seeing in their argument, is that they want to preserve the ecosystem today as it's status quo, because they are clearly the largest benefactor of absolutely nothing changing. They don't want to compete. That's what I'm reading here, I don't need Hoeg to point this out to me, I do like it when he points out things I can't see, but this one is blatant. Sony and others will clearly survive this merger. Sony is currently the largest owners of GOTY titles and nominations for the last decades, has all the BEST single player titles according to industry and score, COD marketing rights and Destiny marketing rights all locked up since PS4; yet the other competitors have survived until today.

Then where is this argument going? MS has been forced to innovate to stay alive, they have competed, and are continuing to compete. They have acquired a lot of companies lately, has that turned the corner for them yet? No. Okay. I'm not sure what to say here. Will owning CoD turn the corner for them? IMO no. Will owning the studios that make CoD turn the corner for them, I think yes - but not because they're going to be making more CoD.

They need studios that are capable and competent. MS is still learning to get their studios to the point of where Sony's are. The CoD teams are precisely that. I would be terrified to know that type of talent and experience suddenly arrived on your competitors, they are going to start competing in the content space.

 

[eastmen]

Hmmm, Call of Duty is on the Apple, Sony and Valve storefronts. Although COD didn't appear on the Valve storefront until MS offered to buy Activision-Blizzard. What a coincidence almost as if they knew that MS would be putting COD on Steam as soon as the acquisition went through.

Throw in the Google storefront and that's 4 out of 6 storefronts with only Epic and Nintendo left out. Although, COD is rumored to be coming to the NSW, so that'll only leave Epic out.

If the acquisition goes through. COD will still be on the Apple, Google, Sony and Valve storefronts and likely Nintendo in the near future (MS stated back in Feb. 2022 thatthey would like to get COD on NSW if they were to acquire Activision-Blizzard).

So, basically after the acquisition COD will be on more platforms than before the acquisition ... assuming, of course, that MS hasn't been lying about their intentions WRT the franchise. I suppose that would be why Nintendo isn't against it or has any concerns.

I know that the CMA has made some comments about their concern that the acquisition may harm some of those companies, but I don't recall seeing anywhere that most of those companies actually raised any concerns. Granted, I didn't read the full CMA document, so perhaps that has documentation in it specifying exactly which companies have lodged formal complaints?

Regards,
SB

Don't worry the CMA made comments but none of them hold any water. The majority of the comments sound as if Sony wrote them because they disregard everyone but sony in the majority of it.

 

[Nesh]

.
Economics is the science of studying business practices, production, alternative goods, and consumer purchasing behaviour - why is this irrelevant discussion? Sony is making the argument that ownership of CoD would cause them to foreclose. That means consumers have absolutely no choice but to buy CoD because there are no substitute goods for it and they will go wherever call of duty goes. It's nonsense.
.

I ve never seen such claim from Sony. I think thats your assumption. edit: just saw your highlighted part and still cant see what you claim

Putting Sony aside, if you see this from a consumer point of view, ABK (this counts also for Zenimax) owns a huge selection of popupar franchises that a Playstation owner was enjoying on top of any Playstation specific franchise that becane reality due to Sony's investments like TLOU or GOW or GT etc.

Making these multiplatform franchises exclusive, it reduces the previously available selection for millions of consumers.

The consumer to enjoy some of his favorate multiplatform franchises either has to abandon a franchise by staying on the same platform (reduction of utility), buy a PS and an XBOX (increase of spending) to be able to enjoy thecsame games or abandon PS altogether thus PS specific titles (reduction of utility).

All scenarios have a negative effect on the consumer.

Also MS's argument about Sony being no1 and having better AAA titles is amusing. It is like admitting a)they are incompetent therefore they need to own multiplatform franchises b) they want to get market share using anti-competitive practices using Sony's lead difference as a yardstick of excuse for such practices.

Now you might say "but Sony makes exclusive agreements too". Yeah but thats a far cry from buying indifinetely a whole list of multiplatform popular franchises and the biggest multiplatform studios. There was no issue with MS buying studios per se especially small ones hence not much of a debate was raised. Agreements are temporary, they are subject of the third party company's independent decision, there is no permanent obligation and it is something that both MS, Sony and Nintendo do.

Both companies care about nothing other than their own interests. But the tendency to present MS as the poor child among the three that needs help and to get spoiled because the other two are "richer" isnt a fine argument

 

[Deleted member 11852]

I keep hearing this. You keep saying this. And I know he doesn't work in COMP but he said that it's about COD on Playstation.

https://twitter.com/x/status/1590043081495412736

You'll get no argument from me that the EU comms were awful. If you want to know the breadth of concerns, they have been set out in both UK CMA and EU pre-announcements. I feel like I'm wasting my time though, because there is a core of people here who don't want to believe this is about anything more than PlayStation and Call of Duty. PlayStation, Xbox and GamePass is in scope of what's being considered but it's not all. Again, should you perhaps want to read it, here is the EU statement that covers things that was way outside of Sony's market interests but I'll quote a choice few:

'It's all about COD on PS" isn't some thing only Microsoft are saying. Others are saying it as well. And as vocal as Sony has been about the deal, I have yet to see them put any weight behind any other argument. Everyone else listed as a competitor has been pretty silent about the deal.

I would expect that companies that work closely with Microsoft in some respects be cautious about public communications on any concerns they may have over this deal. Part of this is simply maintaining a good working relationship with Microsoft and the other part is not wanting to disclose your market vulnerabilities. That's just not something companies would do. The reason only documentation from Sony and Microsoft have been released in redacted form is because consent is required for release.

 

[Deleted member 11852]

Because technically no one would be qualified to comment on anything then in this case. He is a lawyer of higher standing than an associate, who specializes in M&A as well as Video Games as per his profile. This is an international M&A deal that also involves the FTC; if his commentary is irrelevant than every single lawyer's commentary is irrelevant as well, considering how few have ever worked with a merger of this size in the video gaming world.

You sound his PR guy. Why are you so invested in this guy's opinion? But well done for ignoring what I said a couple of times in earlier posts, which is that I question his analysis on the UK and EU processes. He may well be very experienced in US process, I have no idea. I am not commenting of any of the US process because I know fuck all about it.

I think you are making a connection that people are anti-Sony because they follow watch his videos and listen to his arguments.

No. Just no. Please stop trying to infer imagined intent in my posts, you are bad at it and I'm not shy about saying what I really think - why would bollock about with trying to put hidden meaning in my posts. As for your suggestion, there is absolutely no correlation you can draw from people watching this guy's videos and any bias they may share. If you look at his YouTube videos, you'll see he's recently done videos on Microsoft, Sony, Epic, Blizzard, Twitter, Elon Musk, the id/Mick Gordon thing, Theranos, the Bayonetta VA nano-drama, and the GTA VI leak.

And most of these videos are dramatising and exaggerating some corporate issue with faux incredulity because that is popular in YouTube land. The videos he's done on Microsoft have been fairly scathing, but that's what appeals to the masses.

And we agreed many times ago that shareholders will not stand for losses like this. 70B is not simply something to just write off, the opportunity costs are enormous. The ABK deal has to go somewhere or have some sort of reasoning behind it in preparation for a far future in which this investment is worthwhile for MS to take onboard, which is the only reason this inquiry should exist, but that reason cannot be the monopolization of the video game market, it's far too small to make sense.

I don't know who you mean by "we agreed", but Microsoft shareholders were not balloted on this acqusition (Activision-Blizzards shareholders were) and shareholders have no say in day-to-day operations. If this all goes wrong, the only recourse is asking the board try and bring pressure on the management team, or seek board resignations. But to get back on track, nobody is saying that Microsoft are buying Activision-Blizzard with the intent of losing money, but their ROI forecast has to be incredibly long - with some loses during the transition - which is normal. But should they not recover the costs during an 'business model adjustment', that's just the price of doing business.

View attachment 7599
Highlights are mine. This is their conclusion paragraph, meaning all their arguments leading up to this support this particular axiom. Sony's argument here is that the gaming ecosystem is being threatened, and my comprehension here is that means the industry.

That is different to what you said/claimed earlier; quoting you:

Sony is making the argument that ownership of CoD would cause them to foreclose.

Are Sony taking the piss? Yeah, of course they are. Are Microsoft ding the exact same thing? Yeah.. I see both of these companies for what they really are. Large, powerful, influential and wanting to protect their particular business interests. How about you?

 

[BoardBonobo]

US competition regulator "likely" to challenge Microsoft-Activision deal

From Eurogamer​

 

[BRiT]

US competition regulator "likely" to challenge Microsoft-Activision deal​

​

From Eurogamer​

Which is echoing the Politico clickbait headline where the actual article states:

A lawsuit challenging the deal is not guaranteed, and the FTC’s four commissioners have yet to vote out a complaint or meet with lawyers for the companies, two of the people said. However, the FTC staff reviewing the deal are skeptical of the companies’ arguments, those people said.

https://twitter.com/x/status/1595552805053399051

 

[BRiT]

Activision Blizzard exec Lulu Cheng Meservey statments:

https://twitter.com/x/status/1595593332666900481

https://twitter.com/x/status/1595593334772432897

 

[Nesh]

Activision Blizzard exec Lulu Cheng Meservey statments:

https://twitter.com/x/status/1595593332666900481

https://twitter.com/x/status/1595593334772432897

Do you honestly believe an executive from the company that agreed to a merge or Microsoft themselves will somehow say anything against the merge?

 

[mr magoo]

Battlefield Can't Keep Up With Call of Duty, Says Sony

The PlayStation maker says Call of Duty is still top dog.

nordic.ign.com

But hey it’s not about COD. It’s Microsoft narrative

 

[mr magoo]

You mean the unrelated cash grab apps full of IAPs or the mobile apps to accompany the PC/console game or the actual PC/console Call of Duty games? I can't see any actual Call of Duty games on the iOS or Google Play stores.

What do you mean unrelated? It’s call of duty mobile. And it’s actually pretty good. I play this on mi iPhone with Xbox controller. It has rating 4.6 with over 11k reviews. At least here in Sweden.

 

[BRiT]

Do you honestly believe an executive from the company that agreed to a merge or Microsoft themselves will somehow say anything against the merge?

It doesn't matter what we think or believe.

 

[Nesh]

It doesn't matter what we think or believe.

Of course. And we DO know she is an Activision exec. Maybe she is right maybe she is not.
Whatever the case, it is not an independent source so whatever she says in public doesnt matter either.

 

[Nesh]

Battlefield Can't Keep Up With Call of Duty, Says Sony

The PlayStation maker says Call of Duty is still top dog.

nordic.ign.com

But hey it’s not about COD. It’s Microsoft narrative

Thats Sony. The regulators are not Sony. Sony will worry about it's own affected business. The regulators check all potentially affected markets and competitors.

 

[Deleted member 11852]

What do you mean unrelated? It’s call of duty mobile. And it’s actually pretty good. I play this on mi iPhone with Xbox controller. It has rating 4.6 with over 11k reviews. At least here in Sweden.

I mean it's neither Warzone or Modern Warfare II. I don't doubt your enjoy it.

 

[Deleted member 11852]

It doesn't matter what we think or believe.

No offence but I think that is in part why there is such a poor level of discourse and so much noise in many forums. I assume you received, or were aware, of the message Rhys sent around 5 November. ¯\_(ツ)_/¯.