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People don't seem to give the FTC much chance of blocking this. All seems to come down to CMA as people seem to think the EU will pass?
Interesting stuff... thanks for posting... many see the FTC's decision as weak and not holding up in court. the CMA might be the main problem.
Good summary of everyone's conclusions : CMA is the biggest danger to MS x ABK, EU will probably greenlight the deal, FTC's case is really weak.
This one is really silly when Nvidia is like 80% of the dgpu market.
Cheers Pixis, of course, I bow to your experience and expertise. Thanks for the explanation.
OP
OP
There are lots of articles from NY Times, Wall Street Journal, Bloomberg, Reuters and more about the deal. They include some new bits of info and specially third party opinions, that are always interesting for detabe.
The consensus in general is that:
- The FTC has an up hill battle to defend the case.
- MS has a serious timing problem.
- UK and Europe are the key now, specially UK.
- Now that the FTC has challenged the deal, UK and EU could do the same too.
More or less, what I mentioned yesterday: next 4-5 weeks are super relevant, in January we should have a clearer picture, the deal could be abandoned as soon as January or take a bit longer until April, if Microsoft can get approvals from the CMA and the EU and wants to challenge the FTC, they'll need more time and they'll have to renegotiate the merger agreement.
The consensus in general is that:
- The FTC has an up hill battle to defend the case.
- MS has a serious timing problem.
- UK and Europe are the key now, specially UK.
- Now that the FTC has challenged the deal, UK and EU could do the same too.
More or less, what I mentioned yesterday: next 4-5 weeks are super relevant, in January we should have a clearer picture, the deal could be abandoned as soon as January or take a bit longer until April, if Microsoft can get approvals from the CMA and the EU and wants to challenge the FTC, they'll need more time and they'll have to renegotiate the merger agreement.
Lina Khan, Aiming to Block Microsoft’s Activision Deal, Faces a Challenge
Ms. Khan, the chair of the Federal Trade Commission, has staked an ambitious trustbusting agenda on a case that may be difficult to win.www.nytimes.com
Microsoft Faces Tougher Path to Closing Activision Deal
The software giant should give up on the deal, some analysts said, following the FTC’s suit to block the planned $75 billion acquisition.www.wsj.com
FTC’s Move to Block Microsoft’s Deal for Activision Blizzard Came Despite Charm Offensive
The software giant had been working for nearly a year to calm regulators’ concerns about its acquisition of the videogame developer, but the agency’s lawsuit raises doubts about Microsoft’s pledge not to shut out rivals.
Microsoft's Fight for Activision Is a Bet on the Future of Gaming
Cloud gaming is a nascent technology today but experts think it could eventually make consoles like the Xbox and PlayStation less relevantwww.bloomberg.com
That's not true. The regulatory bodies have to define the market in their region. Xbox is tiny relative to PlayStation in the EU. Even if they compare xCloud to PSNow.
I'm more curious about renegotiations between Activision and Microsoft. How will that play out and what could go wrong there?
they'll just sign a one page memo saying we agree to change that June 2023 date to 2024 and move on.
Reading the latest update from Idas and yeah I don't think that this deal is happening. I think MS will pull out in January.
So, then what is their next move would be the big question. I guess this deal would have put them off buying a publisher anywhere close to activision's size.
Maybe go all in on third party deals? I'm doubtful as they would want to own the IP.
Maybe just do nothing? I dunno.
So, then what is their next move would be the big question. I guess this deal would have put them off buying a publisher anywhere close to activision's size.
Maybe go all in on third party deals? I'm doubtful as they would want to own the IP.
Maybe just do nothing? I dunno.
Right! It's hilariously bad.
The funniest thing is, they actually mention an ACTUAL essential input to the platform market, GPUs. But since MS isn't acquiring an essential input, they came up with a hare-brained hypothetical scheme to argue that MS will obtain GPU market power by proxy.
Perhaps spin off CoD and all involved team to EA/Take Two ?
Or abandon the deal and move on to Capcom (strong mobile presence) and other smaller pubs. Also secure more deals with third party pubs.
Or abandon the deal and move on to Capcom (strong mobile presence) and other smaller pubs. Also secure more deals with third party pubs.
That's what makes it so frustrating. Basically business as usual with Nintendo and Microsoft fighting for scraps in the third party market for those AAA games.
Pretty much this. It seems those who defend the FTC's position didn't want this to go through in the first place that aren't really based on any facts.
Speculating is also fun of course.. I wonder if we are at the key moment of this industry where we say a few years from now: 'well, we could have had a competitive Nintendo and Microsoft alongside Sony'
Especially this deal going through would be huge for Nintendo
Still want it to go through so we can see unhinged threeway of coporations fighting at their best
Especially this deal going through would be huge for Nintendo
Still want it to go through so we can see unhinged threeway of coporations fighting at their best
Sometimes, I think some of us take weird points to argue when it does not make sense. It can only be due to bias from where I sit.
Everyone could see it was false, and geared to mislead. The EU has commented and still you argue? That up there is a lot of words, and I cannot fathom what for. What is the end game?
If they are just going to get continuously blocked (even on smaller deals) for big tech reasons; I can't see them doing anything, because what is the point?
I mean did you buy because you believe that price is fair for an Activision in a world without Microsoft being under them?
Because if you solely bought them on the premise of this deal and the stockprice it would be going to when the deal closes.. That is gambling imo
Well, tbf they bought Bethesda with almost no blow back. Maybe only EA would cause them the same problems like the activision deal has.
I would give GeForce Now access to Call of Duty, and commit to not make any Game Pass exclusive (and I mean : not available at retail) for the foreseeable futur.
This sums it up perfectly.
The fact that it has got to the point where different scenarios have to occur for it to work says it all: "Well, if X happens, then Y could possibly happen. That will allow Z to occur if this specific thing didn't happen with Y, assuming Y happens at all."
Just think of it all more broadly. Think of the tone of all the reports we received since this whole thing started. Taking an article that makes things sound better and running with it is ignoring what is looming up above it all.
This is probably when big tech forms an alliance and threatens to pull out of countries where there are ideologically driven regulators who only see in black and white. That's something that we don't want because the combined power of big tech will absolutely cause governments to back down completely because at the end of the day it's not just gaming, regulators like Khan are targeting almost everything no matter how big or small it is. Sure they could wait it out until a more favorable administration shows up, but it's a worldwide trend and not just in the USA
I do not think there is a world in which ATVI gets blocked and Xbox stops acquiring. Only in Playstation fan dreams.
They are going to be just as aggressive at talent acquisition as before. Although they will probably try to find more publishers with a mobile component.
They are going to be just as aggressive at talent acquisition as before. Although they will probably try to find more publishers with a mobile component.
Absolutely, and that is the problem because big tech is an issue, but regulators can't seem to navigate these waters.
Yeah I agree. I think people take all reports as truth and then the opposite happens . It happened with the NY post and a couple of months ago with dealreporter when they said that the European Comission had no major concerns, and in the end, they had.
Right now, I only believe what Politico and Reuters say, they have proven to be the only ones to be right all the time.
Ultimately it's about Game Pass content and a push into mobile. If this deal drops and some fans get all happy about it, no for sure MS will go for something smaller but probably more disruptive. They are part of the industry now, this won't change.
I agree, they will continue to invest in gaming, however I don't think they will be able to acquire any big publisher after this. Certainly not EA or Take Two and maybe not even Ubisoft. SEGA and others should be fine.
Theres only one publisher close to Activision size and thats EA.
But yea I don't think this goes through. Always look at the glass half empty
If Microsft takes the 4+1 publishers the FTC talks about to heart (lol) then you get into publishers that this board would REALLY flip over. At least for this board's sake, ATVI is probably the least offensive acquisition to gamer tastes. When you get past that 4±1 you get into some territory that will cause serious meltdowns. And it is coming. Xbox needs to feed the Game Pass beast.
They never want another 2022 and they are determined to not have one imo.
Seems we mostly agree.
I can personally see MS go after two publishers that are in Sony's radar, those being Square and CDPR (not AAA according to the FTC). If they acquire Square Enix for example, they might just pay whatever fee there is to cancel the exclusivity contracts. They wont pull games away from the PlayStation but will certainly limit them from getting timed exclusive deals which should help level the playing field a bit.
I think Square and Capcom is the logical duo to go for if MS wants to "get back" at Sony for trying to derail the ActiBlizz deal. Gives them mobile and Game Pass content for sure and probably way easier to get hold of.
I agree about EA, maybe they could try for take two? But I really don't think they will try for anyone after this. I think we will see a change of approach and they would rather not go through this again.
If you take out ABK, EA, T2 and Ubisoft, logically you also need to remove SE and Bamco because they're both bigger than Ubi by revenue.
That leaves you SEGA, Capcom, Konami and WB of the big ones.
Embracer too, actually would be a good way to absolutely stuff GP with content.
That leaves you SEGA, Capcom, Konami and WB of the big ones.
Embracer too, actually would be a good way to absolutely stuff GP with content.
I honestly think SEGA is the most likely. They have so much Xbox has publicly stated they lack and can help in areas they are trying to push into. They have kid friendly and JRPG. They have studios to help on PC games especially RTS. They have a long history with Xbox.
The funny thing is ABK is the acquisition least likely to make people mad. The big game was going to stay multiplat. The Era crowd aren't that attached to COD or most ABK franchises. Many of the more casual fans are less brand loyal and happy to move for the content. If MS continues and aims lower, people will feel it - and they'll come up with new reasons why it's SO OBVIOUS why MS needs to be blocked. Eh. The circle of life.
I mean, really, I think far more rides on the success of Game Pass than on the success of the MS/ABK deal. But if Game Pass growth indeed stagnates (hasn't yet) and they can't juice it with major enthusiasm from stuff like major acquisitions, then that does indeed change the calculus. And at that point, yea... Is it even worthwhile to try to take on Sony head on? Every single thing they do will be more expensive because they're not Sony and not Nintendo. Forget Apple and Google, you have zero chance there. Already lost on PC.
People expect Microsoft to spend more money forever (because they can afford it!) just to always be behind and fighting to stay relevant in the market. But why? Sure they've acquired a lot recently, and those investments will come in fairly soon. But I don't expect any of those to fundamentally alter the position of Xbox to Nintendo or PlayStation. It's possible that PS stumbles, makes major mistakes, and can't recover - but boy, PS has stumbled, made major mistakes, and recovered with no issue and limited consumer blowback time and time again (this is a skill, not discounting that).
We're only about 5 years out from when the conventional wisdom was Xbox was dying, leadership didn't believe in it, and shareholders wanted it killed or spun off. Not very long ago. And sure, they will want to protect their employees and see their investments pay off. But just remember that they bought Nokia and essentially killed it because it wasn't working just a couple years in. Satya Nadella came to power at MS and immediately killed a BUNCH of darling projects. There's nothing that guarantees survival in this business and video games is more mercurial than most. Maybe that's a point in favor of the approach of the FTC - small ripples could easily kill Sony, so we have to protect them from Microsoft. Or maybe that's the reason their arguments are so full of crap. Who knows.
But I firmly believe this industry is worse when there is a clear dominant platform holder leader. Xbox isn't going to die or anything if this gets blocked. Far from it. But it will have a negative impact, in brand perception and sentiment if nowhere else. And I don't know how hopeful I am that we will like where everything is headed with an even weaker Xbox. But now I'm just dooming.
We'll see ^^ [I can't say I remain optimistic anymore :(. But I do still think it will close - it's just now accompanied by a lot of outward frustration and negativity about how the process has gone down lol.]
Play Sony's game or get out of the market. Pay for exclusivity and lock up big games, push everyone else out of the market, and hope the industry doesn't collapse in the process :p
I mean, really, I think far more rides on the success of Game Pass than on the success of the MS/ABK deal. But if Game Pass growth indeed stagnates (hasn't yet) and they can't juice it with major enthusiasm from stuff like major acquisitions, then that does indeed change the calculus. And at that point, yea... Is it even worthwhile to try to take on Sony head on? Every single thing they do will be more expensive because they're not Sony and not Nintendo. Forget Apple and Google, you have zero chance there. Already lost on PC.
People expect Microsoft to spend more money forever (because they can afford it!) just to always be behind and fighting to stay relevant in the market. But why? Sure they've acquired a lot recently, and those investments will come in fairly soon. But I don't expect any of those to fundamentally alter the position of Xbox to Nintendo or PlayStation. It's possible that PS stumbles, makes major mistakes, and can't recover - but boy, PS has stumbled, made major mistakes, and recovered with no issue and limited consumer blowback time and time again (this is a skill, not discounting that).
We're only about 5 years out from when the conventional wisdom was Xbox was dying, leadership didn't believe in it, and shareholders wanted it killed or spun off. Not very long ago. And sure, they will want to protect their employees and see their investments pay off. But just remember that they bought Nokia and essentially killed it because it wasn't working just a couple years in. Satya Nadella came to power at MS and immediately killed a BUNCH of darling projects. There's nothing that guarantees survival in this business and video games is more mercurial than most. Maybe that's a point in favor of the approach of the FTC - small ripples could easily kill Sony, so we have to protect them from Microsoft. Or maybe that's the reason their arguments are so full of crap. Who knows.
But I firmly believe this industry is worse when there is a clear dominant platform holder leader. Xbox isn't going to die or anything if this gets blocked. Far from it. But it will have a negative impact, in brand perception and sentiment if nowhere else. And I don't know how hopeful I am that we will like where everything is headed with an even weaker Xbox. But now I'm just dooming.
We'll see ^^ [I can't say I remain optimistic anymore :(. But I do still think it will close - it's just now accompanied by a lot of outward frustration and negativity about how the process has gone down lol.]
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But acquiring ATVI doesn't really mean that Microsoft would not have pursued any other publishers? In fact, no regulatory pushback may have encouraged them to continue to consolidate publishers at a rapid clip. They stated regardless of this outcome, they were going to continue to acquire companies.
Second thing is never having another 2022. Their development studios, like many across the board, were impacted by COVID. But as we move further away from the depths of the pandemic, development timelines should normalize. With 23 development studios, not to mention XGP, I don't know how it's possible to not have a steady downpour of quality exclusives.
Same.
You specifically need to prepare yourself for more acquisitions tbh.
Microsoft has already hinted at such. Now if the Activision deal falls through they will just accelerate the timeline of acquiring those smaller companies instead.
That's…the entirety of my post though?
I don't think the "people should want ATVI to go through, otherwise Microsoft will really make people mad with some buys," makes sense when Microsoft said they are going to acquire more developers regardless of this acquisition.
Wouldn't if AB goes thru, deals for EA or Take Two fail? Like that would lessen their argument of not trying to be anti competitive if they literally buy 1 more major publisher right?
At the moment I am leaning 55% this deal failing due to political grandstanding essentially.
The blizzard and activision unions will be busted, jobs will be lost and everyone will go back to "fuck kotick why can't anything be done about him"
Microsoft will be pissed, they won't be backing down or out of gaming and they won't be diminishing their strategies. I can see 3 viable strategies with various levels of nuclear energy in them (in all of them ms will pay the 3B kill fee)
1. Microsoft could buy a perpetual lease on the call of duty IP and the advantage perks swings back to Xbox. League tournaments and other competitive events will masthead Xbox aswell. They could even do a double fuck PlayStation and try to get an exclusive licence deal for all ABK content
2. Microsoft reinvests that money into publishers of a smaller scale that can sign deals and publish games for gamepass at a similar cadence. Embracer / Devolver / sega / capcom / square enix all top of list and all orders of magnitude smaller than ABK and all without a "critical IP" that would "endanger competition"
3. Microsoft pulls the petty card and burns money to bleed Sony dry at their own game. First right of refusal means Microsoft would need to essentially blind auction Sony to find where their pain points are for the IPs they value most but they'll find them and they will deal them
Gamepass growth is a key cornerstone, cloud gamepass is a key business growth corridor that marries 2 of their pillars and they will be damned if they let another government regulator tell them how to run their ecosystems whilst apple and google are left free to run more draconian and for closed markets with impunity imo
The blizzard and activision unions will be busted, jobs will be lost and everyone will go back to "fuck kotick why can't anything be done about him"
Microsoft will be pissed, they won't be backing down or out of gaming and they won't be diminishing their strategies. I can see 3 viable strategies with various levels of nuclear energy in them (in all of them ms will pay the 3B kill fee)
1. Microsoft could buy a perpetual lease on the call of duty IP and the advantage perks swings back to Xbox. League tournaments and other competitive events will masthead Xbox aswell. They could even do a double fuck PlayStation and try to get an exclusive licence deal for all ABK content
2. Microsoft reinvests that money into publishers of a smaller scale that can sign deals and publish games for gamepass at a similar cadence. Embracer / Devolver / sega / capcom / square enix all top of list and all orders of magnitude smaller than ABK and all without a "critical IP" that would "endanger competition"
3. Microsoft pulls the petty card and burns money to bleed Sony dry at their own game. First right of refusal means Microsoft would need to essentially blind auction Sony to find where their pain points are for the IPs they value most but they'll find them and they will deal them
Gamepass growth is a key cornerstone, cloud gamepass is a key business growth corridor that marries 2 of their pillars and they will be damned if they let another government regulator tell them how to run their ecosystems whilst apple and google are left free to run more draconian and for closed markets with impunity imo
EA and T2 are off the table for Microsoft regardless of what happens with ABK. Too much push back is being encountered where the same issues would not crop up as well with the other 2.
If the deal fails, then Microsoft will probably find someone else that will enable them to make a bigger push into mobile.