Microsoft Says Activision Shouldn't Have Pulled Call of Duty From Steam

John Elden Ring

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Call of Duty should never have been taken off Steam, Microsoft has proclaimed in a new post-trial filing following its court victory against the Federal Trade Commission.

Now that the odds are more firmly on Microsoft's side, the company has submitted a fairly significant new batch of filings that discuss some of the key events leading up to its acquisition attempt.

One of the most interesting of these filings concerns Activision's decision to make the Call of Duty franchise a Battle.net exclusive in hopes of helping the platform grow. According to Microsoft, this tactic was a "resounding failure," and leaving Steam did not lead to substantial growth in Battle.net's user base. Microsoft plainly states that the plan did not lead to a substantial user base growth for Battle.net, while in roughly the same time period, Steam essentially doubled in size, jumping from 67 million users in 2017 to 132 million in 2021. Microsoft's conclusion was, therefore, that Activision failed to bank on exclusive access to Call of Duty

 
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flaccidsnake

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If you're not on Steam, you're not on PC. Death to Battle.net, Epic Games, Ubisoft Connect, EA Origin, and any other "launcher" cluttering my PC or requiring a new account on console. It's good to see Microsoft recognizing Activision's failure here. One positive that could come from MS buying Activision would be the shuttering of Battle.net for Blizzard games in favor of Steam.

It should be said that MS is only halfway decent on PC. While they rightly support Steam, all Xbox 1st party games require a Microsoft login which fucks up the user experience.
 

nongkris

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I'm sure the 30% they saved from Steam's cut amounted to 100's of millions and had a lot more to do than "growing" battle.net's subscribers. Microsoft and Steam seem to be in bed with each other, they are one of the main supporters of this acquisition
 
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ethomaz

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Not sure what they consider failure…

For Activision Blizzard it was around 42% more revenue without any change in userbase.
 

ethomaz

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I'm sure the 30% they saved from Steam's cut amounted to 100's of millions and had a lot more to do than "growing" battle.net's subscribers. Microsoft and Steam seem to be in bed with each other, they are one of the main supporters of this acquisition
This… imagine having the same number of subscribers but 42% more revenue per user.
 

Systemshock2023

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Steam cut is much lower with big earners like MS, rockstar, Sony, EA or CDPR. That 30 percent cut does not apply, must be closer to 20.
 

ethomaz

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Steam cut is much lower with big earners like MS, rockstar, Sony, EA or CDPR. That 30 percent cut does not apply, must be closer to 20.
Doesn’t change the point I guess… instead to have 42% more revenue they have 25% more revenue.

Who avoid the Steam is not looking for bigger userbase but more revenue from the same userbase (even with the lose of some part of it like 10%)… that is the reason you pull off from Steam.

And of course it will only works with a franchise that has already a solid userbase.
 

KnittedKnight

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Don't be surprised if the cat goes out the bag that MS is acquiring Steam in the mid-term future - 5-6 yrs from now (or at least attempting, planning, devising the strategy). MS will definitely try if they feel confident in their position on cloud and that the cloud "future" is prime and has arrived and they're in the driver's seat. It will be the coup de grace. The final touch sort of speak on their strategy. Absorbing Steam to turn that userbase into subscription sheep and transition them slowly to the cloud is a most logical step. Too machiavellian for it to not occur. I can almost guarantee it. Private company too - easy. Just a dollar term and everyone has a price. I've step back from Steam for that and several other reasons. Ain't gonna hook me with the library trap - which is one the main reasons why Valve is a storefront monopoly.
 
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ksdixon

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Don't be surprised if the cat goes out the bag that MS is acquiring Steam in the mid-term future - 5-6 yrs from now (or at least attempting). They'll definitely try if they feel confident in their position on cloud and that the cloud "future" is prime and has arrived and they're in the driver's seat. It will be the coup de grace. The final touch sort of speak on their strategy. Absorbing Steam to turn that userbase into subscription sheep is a logical step. I can almost guarantee it. Private company too - easy. Just a dollar term.

Of course it is. I've always assumed Gabe will one day sell-back to MS. Giving them the de facto PC store, neutering SteamOS/Lynx gaming.
 
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historia

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Don't be surprised if the cat goes out the bag that MS is acquiring Steam in the mid-term future - 5-6 yrs from now (or at least attempting, planning, devising the strategy). MS will definitely try if they feel confident in their position on cloud and that the cloud "future" is prime and has arrived and they're in the driver's seat. It will be the coup de grace. The final touch sort of speak on their strategy. Absorbing Steam to turn that userbase into subscription sheep and transition them slowly to the cloud is a most logical step. Too machiavellian for it to not occur. I can almost guarantee it. Private company too - easy. Just a dollar term and everyone has a price. I've step back from Steam for that and several other reasons. Ain't gonna hook me with the library trap - which is one the main reasons why Valve is a storefront monopoly.
EEE in action
 

nongkris

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According to Tyler McVicker, Valve have been trying.

I guess it's a bit of a technical hurdle since Game Pass is tied to the horrible UWP system.
of course valve would try, they're chomping at the bit to take 30% revenue share from MS' sales. There is no technical problem at all, that's an excuse to let MS pretend like they have no problem with Steam but in reality know the power of having your own storefront
 

Zzero

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I'm sure the 30% they saved from Steam's cut amounted to 100's of millions and had a lot more to do than "growing" battle.net's subscribers. Microsoft and Steam seem to be in bed with each other, they are one of the main supporters of this acquisition
Valve hates Microsoft and created the Steam Deck specifically so it wouldn't have to live in MS's world. It is also the world's biggest PC games storefront and a direct MS competitor. Its one of the few games companies that Microsoft legitimately would be blocked from buying for anticompetitiveness concerns (along with such "gaming" companies as Apple, Facebook, Amazon and then perhaps Epic due to EGS.)
 
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KnittedKnight

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Considering the state of antitrust regulation these days, as proven by the ABK/Bethesda mergers there is a lot of room MS has to work with if they decide to acquire Valve and a fart is sent their way by antitrust bodies. Much easier since it's a private company as well in terms of reaching a deal and avoiding causing a furor from competitors (who will lobby for action). Nobody depends on Steam for their dough - not Apple, not Amazon, not even Sony. Nobody depends on Valve content either cause Valve dropped the software game a long time ago. Valve is picture made for a Microsoft acquisition. They'll definitely cite Apple's and Google's Android's storefronts (Apple store, Google Play Store), bring the Epic vs. Apple ruling to the forefront as a talking point.... get the right judges, examine the make up of the regulatory bodies (who's buyable, who's not, what the angle will be - position resources accordingly in anticipation) and work from there. I expect them to at least be infinitely more prepared to subvert and corrupt the process due to experiences with the ABK deal. They already got their plant in the EU. Although the EU commission is not a roadblock in any way shape or form clearly, regardless of.

I guess we're all free to project what we think will, could happen theoretically. I'm of the opinion, in the current environment, a MS/Valve merger will face much less hurdles, specially if the ABK deal fails and thus it does not become a weapon antitrust regulators can use to bash MS's head in. Of course there is going to be a lull, as a strategy is deviced - acquisitions and mergers all serve a strategy - they're not just "wants". We're also just talking PC gaming here, a software subset class on Windows. The only thing you're acquiring is a software distribution operation (a middleman), not content that can be taken away strategically from competitors. Half Life/Counter Strike ain't key to anybody.
 
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Zzero

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Considering the state of antitrust regulation these days, as proven by the ABK/Bethesda mergers there is a lot of room MS has to work with if they decide to acquire Valve and a fart is sent their way by antitrust bodies. Much easier since it's a private company as well in terms of reaching a deal and avoiding causing a furor from competitors (who will lobby for action). Nobody depends on Steam for their dough - not Apple, not Amazon, not even Sony. Nobody depends on Valve content either cause Valve dropped the software game a long time ago. Valve is picture made for a Microsoft acquisition. They'll definitely cite Apple's and Google's Android's storefronts (Apple store, Google Play Store), bring the Epic vs. Apple ruling to the forefront as a talking point.... get the right judges, examine the make up of the regulatory bodies (who's buyable, who's not, what the angle will be - position resources accordingly in anticipation) and work from there. I expect them to at least be infinitely more prepared to subvert and corrupt the process due to experiences with the ABK deal. They already got their plant in the EU. Although the EU commission is not a roadblock in any way shape or form clearly, regardless of.

I guess we're all free to project what we think will, could happen theoretically. I'm of the opinion, in the current environment, a MS/Valve merger will face much less hurdles, specially if the ABK deal fails and thus it does not become a weapon antitrust regulators can use to bash MS's head in. Of course there is going to be a lull, as a strategy is deviced - acquisitions and mergers all serve a strategy - they're not just "wants". We're also just talking PC gaming here, a software subset class on Windows. The only thing you're acquiring is a software distribution operation (a middleman), not content that can be taken away strategically from competitors. Half Life/Counter Strike ain't key to anybody.
Microsoft's gaming division and Valve are both primarily storefronts/platforms, which makes it a horizontal rather than vertical merger from that angle (that means it would historically get more scrutiny, not less.)
 
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JAHGamer

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Xbox should be the last ones giving anyone business advice, especially not to an infinitely more successful publisher
 
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