Microsoft accuses UK regulator of adopting Sony’s complaints over Activision Blizzard deal

[Eternal_Wings]

Sony dont seem like the kind to spend tens of billions on acquisition for PlayStation, they would be better off just selling PS to meta , apple or google than compete with MS consolidation efforts.

Where comes the picture, that Sony can’t afford nothing?
They wanted back then also buy Fox and did bid like 60 billion dollars. Sony is able buy publishers if they wanted. But I agree not in this Activision Blizzard King dimensions.

Selling their most profitable business, I don’t think so.

 

[Eternal_Wings]

@Eternal_Wings do you have the link for the full document?

Unfortunately he didn’t share the documents, only snippets. Maybe if will later do, on his website the Verge.

 

[Darth Vader]

Have a bit more time to dissect the images @Eternal_Wings so kindly posted. Not going to comment on everything because there are a couple of topics I'm not knowledgeable enough to discuss.

Sony PlayStation has been the largest console platform for over 20 years, with an installed base of over 150 million consoles making it larger than Nintendo and more than double the size of Xbox

This is not an argument for or against the acquisition.

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.

Nonsense argument. I could make the same argument and say Microsoft abuses its position in the OS market by pricing above Linux distributions, which are free. People are free to choose machines with Linux, they choose not to pick those (for the most part) because they perceive the offer Microsoft has to be either more convenient and/or of better value.

The suggestion that the incumbent market leader, with clear and enduring market power, could be foreclosed by the third largest provider as a result of losing access to one title is not credible. There are more than 4000 games available on PlayStation alone

PlayStation is one of Sony's main source of revenues. A lot of players pick their console based on the convenience in interacting with friends and family members. Losing one title as big as COD could have an impact in the order of millions of dollars alone just in console revenue alone, let alone additional sales via Store.

Also very interesting that they assume Sony will lose the game, but then promise they won't.

Since the transaction was announced, Sony has acquired several game studios - Bungie, developer of the popular game Destiny 2, Haven Studios, Lasengle and Savage Games - And a minority interest in From Software, the developer of the biggest game of 2022, Elden Ring (among other hit games). This complements Sony's existing minority shareholding in Epic Games, publisher of Fortnite, strong first-party game catalogue and extensive portfolio of exclusive arrangements with third-party publishers. There were over 280 exclusive first and third-party titles on PlayStation in 2021, nearly five times as many as on Xbox.

First of all, is this an advert for PlayStation? Because it reads like one. But anyway, let me bullet point this puppy because it's probably the stupidest of the bunch.

• The acquisitions of all those studios do not equal one Bethesda.
• Minority positions without board representation are meaningless and a way to diversify your investments.
• Sony paying for third party developers and publishers to develop exclusive games for its platform is a good business practice - It's an investment.
• First-party offerings are resultant of a strong portfolio of well managed studios that provide value to gamers.

Overall, the dumb-ass that thought of this point should be fired on the spot.

https://abload.de/img/mobile.19qfibq.jpeg

Please remind me, Microsoft, who bought Bethesda and took games away from Playstation? Does the Starfield name ring a bell?

https://abload.de/img/mobile.209rcbx.jpeg

This one is priceless. Are they really arguing that one company owning more of the market somehow increases competition? Sounds like the arguments Bernd was making a week or so ago. How does the acquisition not going through prevent MS from providing games in more channels? They can simply pay Activision to allow them to publish games on Gamepass and XCloud, so whats the issue?

____

I think it's pretty obvious whats happening - MS is scared that the UK regulator will throw a wrench on their big plan of market consolidation, which IMO goes like this

1. Acquire as many publishers as possible in order to gobble up recognised and established IP
2. Use that leverage to force Sony to allow Gamepass on PS consoles
3. Gobble Sony's profit margins via Gamepass
4. Monopolise the home console market

 

[IntentionalPun]

I find this amateur hour analysis of legal filings really corny. Especially when it's a bunch of blatant fanboys doing it.

I'll just be waiting for a decision from regulators myself.

Hope it's 100% blocked, but I doubt it will be.

 

[Darth Vader]

AFAIK there hasn't been a study on the effects of consolidation in the gaming industry, but there's examples from other markets.

https://www.sciencedirect.com/science/article/pii/S0140988321005375

Our results may be of interest from both the scientific and policy point of view as well. On the one hand, our findings underpin that the effects of a horizontal merger can significantly increase the prices on the retail gasoline market, which can have significant welfare consequences. On the other hand, we also demonstrate that the effects are not necessarily restricted to the date when the contract is signed or comes into force. In the case of large mergers, the transformation of the stations may require many years, and once it is completed, a further price increase may appear. Based on our results, it would be essential to consider this effect both in scientific research and competition authority decisions.

What We Know About Provider Consolidation

This brief reviews what we know about the impact of provider consolidation on health care prices and quality and finds that consolidation leads to higher prices with no compelling evidence of comme…

www.kff.org

A wide body of research has shown that provider consolidation leads to higher health care prices for private insurance; this is true for both horizontal and vertical consolidation. In Medicare, payment policies protect Medicare from increased prices due to horizontal consolidation but have led to higher Medicare costs in the case of vertical consolidation. However, recent administrative and legislative changes are bringing Medicare reimbursement at hospital outpatient departments in line with reimbursement at independent physicians’ offices.

(...)

While provider consolidation holds the promise of greater efficiencies and better care coordination, evidence of the benefits of improved quality after a merger are mixed at best, and some studies suggest that market consolidation—particularly for horizontal consolidation—can actually lead to lower quality care. It is difficult and takes time and resources to achieve true integration of care among newly merged health systems, while price increases often occur immediately after consolidation

Bigger But Not Better: Hospital Mergers Increase Costs and Do Not Improve Quality

www.ncbi.nlm.nih.gov

• Hospital consolidation results in higher prices. This is true across geographic markets and different data sources. When hospitals merge in already concentrated markets the price increases can be dramatic.
• Physician-hospital consolidation has not led to either improved quality or reduced costs. Studies find that consolidation was primarily for the purpose of enhanced bargaining power with payers, and hence did not lead to true integration. Consolidation without integration does not lead to enhanced performance.
• Hospital competition improves quality of care. This is true under both administered price systems such as Medicare and the English National Health Service, and market determined pricing such as the private health insurance market. The evidence is more mixed from studies of market determined systems, however.

If anyone thinks it would be any different in the gaming industry, they're wrong. And again, this applies to consolidation efforts by MS, Sony, Tencent, etc.

 

[Darth Vader]

I find this amateur hour analysis of legal filings really corny. Especially when it's a bunch of blatant fanboys doing it.

I'll just be waiting for a decision from regulators myself.

Hope it's 100% blocked, but I doubt it will be.

This is a forum. If you find opinions corny, then please abstain yourself from dropping shit nuggets.

 

[IntentionalPun]

This is a forum. If you find opinions corny, then please abstain yourself from dropping shit nuggets.

Well it's just my opinion, man. And it's a forum, so I'm allowed to say my opinion <3

I'm just messing around though... but we are looking at legal arguments back and forth from corporate giants.. and none of us have any clue how regulators will react to this shit.

 

[Remember_Spinal]

The worst part about this entire ordeal is the fact that it gave CoD so much free marketing. Just when the last couple years the series was starting to fade out of the zeitgeist as afar as things to talk about in enthusiast circles here we go with now making it the most important game of all time.

 

[Hezekiah]

I find this amateur hour analysis of legal filings really corny. Especially when it's a bunch of blatant fanboys doing it.

I'll just be waiting for a decision from regulators myself.

Hope it's 100% blocked, but I doubt it will be.

You're a founder of the forum, and you think people offering their views on this deal corny, and question the legitimacy of them anyway?

Looks like you came to the wrong place.

 

[ethomaz]

MS really said Haven? Or it was the article.
Why it makes no sense.
Sony basically fund the creation of Haven.

 

[IntentionalPun]

You're a founder of the forum, and you think people offering their views on this deal corny, and question the legitimacy of them anyway?

Looks like you came to the wrong place.

It's one topic that I am tired of.. why are people acting like I shouldn't be on forums because I find the analysis corny?

lol

I'm just over it... I wish we had actual games or tech or something else to talk about but gaming has been pretty fucking boring this last year.

 

[Eternal_Wings]

Moved to: Thread


Edit: Wrong thread sorry.

 

[Loy310]

Where comes the picture, that Sony can’t afford nothing?
They wanted back then also buy Fox and did bid like 60 billion dollars. Sony is able buy publishers if they wanted. But I agree not in this Activision Blizzard King dimensions.

Selling their most profitable business, I don’t think so.

If for them to stay relevant they have to spend $30+ billion on a pub then they better off selling ps is my point.
And people keep telling me they put up 60billion for fox but i cant find that claim anywhere on the web.

 

[Sircaw]

I find this amateur hour analysis of legal filings really corny. Especially when it's a bunch of blatant fanboys doing it.

Must admit, I expected something a little bit better than this from you.

 

[Remember_Spinal]

Microsoft can only be ‘competitive’ if it buys out the competition lol

At 23 studios they have far more than both sony and nintendo and still can’t ‘have competition’ unless they buy out the biggest 3rd party publisher in the business.

Glad the CMA isn’t as naive as Brazil

 

[Dabaus]

Alot of anger and hostility coming from the xbox camp today. Microsoft is basically threating the CMA by reminding them them that they recently lost a court battle. I wonder if intimidating the CMA will have any impact on their decision?

 

[Remember_Spinal]

Best case scenario in my opinion is this gets passed with major concessions that takes the bite out of the CoD, Overwatch, Diablo exclusivity….. i want Microsoft to spend that 70b and never be able to look at purchasing another major publisher again.

If and when this deal most likely goes through it means every other big publisher (ones that i actually like) are safe

 

[riesgoyfortuna]

lol at microsoft using the lies of the usual twitter and forums twitter zealots xD

 

[Dick Jones]

Alot of anger and hostility coming from the xbox camp today. Microsoft is basically threating the CMA by reminding them them that they recently lost a court battle. I wonder if intimidating the CMA will have any impact on their decision?

 

[Yurinka]

I think MS is completely right on what they said there, with an exception: they "forgot" to mention that their commitment to keep CoD on PS was only limited to 3 years more in addition to the already signed ones.

But as MS mentions, making it exclusive wouldn't make sense financially for them and wouldn't hurt Sony at all, PS barely would notice it and would continue being the console market leader.

That makes no sense, in that case they would be in favor of it. Sony even if they have the pennies are not dropping more than a few billion on a pub. So EA and T2 are off the list. Sony dont seem like the kind to spend tens of billions on acquisition for PlayStation, they would be better off just selling PS to meta , apple or google than compete with MS consolidation efforts.

MS needs huge acquisitions to get closer to the market leader, Sony. So it's easier that MS would get greenlighted such huge acquisitions once regulators like CMA and others properly investigate the market numbers.

Sony is in a market leader position, so doesn't need to make big efforts on acquisitions. PS is the biggest platform for the biggest 3rd parties, so the biggest 3rd parties will continue supporting them without needing to be acquired as long as they continue being as super successful as they are and don't need to sell.

To make smaller acquisitions to expand and grow in certain key areas where they don't excel (PC and mobile, FPS, MP, GaaS) makes sense for Sony. But huge acquisitions of big publishers would only make sense for Sony if they think that key strategic 3rd parties, the ones who clearly dominate key genres or game types that Sony doesn't have more than covered with 1st and 2nd party efforts.

ABK is not one of them. ABK is the best selling 3rd party publisher in console, and CoD may be the best selling 3rd party game, but the genres covered by ABK have a lot of other super performing games of that type (GaaS, MP, shooter, FPS in case of CoD) performing great on PS. So ABK or Take 2 being acquired by MS wouldn't be a huge loss for Sony because there are many games of these types performing great on PS. If Sony loses CoD they will continue having a lot of GaaS, MP, shooters, FPS on their platform. If they lose Take 2 they'll continue having a lot of top open world and sports games on PS.

If something, the acquisition of Square Enix, Bandai Namco and Capcom would be more dangerous for them because these companies have a major share of the userbase of certain key genres. That could worry Sony a bit, or could some day make Sony try to acquire them to secure them from anyone who would want to make them exclusive for rival platforms.