Microsoft’s $69 billion Activision takeover faces competition probe in the UK

[Papacheeks]

Microsoft’s $69 billion Activision takeover faces competition probe in the UK:

POINTS:

• It marks one of the first probes by a major antitrust enforcer into the $68.7 billion deal, which was announced in January.
• The CMA said it will consider whether the deal may harm competition through higher prices or reduced choice.
• The acquisition has huge implications for the $190 billion video game industry.

The U.K.’s competition watchdog on Wednesday opened an investigation into Microsoft’s acquisition of video game publisher Activision Blizzard.

It marks one of the first probes by a major antitrust enforcer into the $68.7 billion deal, which was announced in January.


In a statement, the U.K.’s Competition and Markets Authority said its investigation would “consider whether the deal could harm competition and lead to worse outcomes for consumers – for example, through higher prices, lower quality, or reduced choice.”

The CMA has set a Sept. 1 deadline for its initial decision. The regulator said it wants feedback from interest third parties, with a consultation running until Jul. 20, 2022.

Microsoft was not immediately available for comment when contacted by CNBC.

The acquisition has huge implications for the $190 billion video game industry, handing control of incredibly lucrative franchises including Call of Duty, Candy Crush and Warcraft to one of the world’s biggest tech companies.
Microsoft hopes the purchase will help it in the race to build the so-called “metaverse,” a hypothetical network of large virtual worlds. Various other companies are vying for a role in the space, including Facebook parent company Meta and Sony.


However, analysts are skeptical about the chances of a deal being approved by regulators.

Microsoft is one of the largest games console manufacturers alongside Sony and Nintendo, and the company is sitting on a growing hoard of first-party content — including popular game series like The Elder Scrolls and Doom, which it acquired after buying Bethesda-owner Zenimax for $7.5 billion.

Meanwhile, Activision has been beset by numerous internal issues in the past year, including accusations of sexual harassment, unionization efforts and walkouts from staff.

Employees at the company are deeply unhappy with the management and have called on CEO Bobby Kotick to resign. Microsoft previously said Kotick will stay on as CEO of Activision until after the deal closes.

Source: https://www.cnbc.com/2022/07/06/mic...keover-faces-competition-probe-in-the-uk.html

 

[Jim Ryan]

 

[Lord Mittens]

I think the UK have bigger problems to worry about currently lol

 

[Kokoloko]

Why bother, its not gonna make any difference and there all in bed with each other, especially Microsoft lol

 

[TubzGaming]

I think the UK have bigger problems to worry about currently lol

Nothing to see here just the government imploding on itself.

 

[Jim Ryan]

Why bother, its not gonna make any difference and there all in bed with each other, especially Microsoft lol

I deny being in bed with anyone!

 

[Deleted member 38]

I think the UK have bigger problems to worry about currently lol

 

[Kokoloko]

I deny being in bed with anyone!

Not you Jim lol, your not big enough. But MS and the governments

 

[Deleted member 141]

Same UK Competition watchdog that said Game buying GameStation was OK and not a high street monopoly because you could still buy games in a supermarket.

 

[Cragarmi]

Not you Jim lol, your not big enough. But MS and the governments

 

[Bryank75]

I expected Europe to have an issue too.... but they could have been paid off.

I remember the Vestager, the European Competition authority had an issue with Apple in Ireland until Apple put a big data centre in Denmark... her country.
At least that is how it looked from my perspective.

I expect very little from politicians tbh.

 

[Yurinka]

MS shouldn't have any issue to complete the acquisition. There's no monopoly at all. Even including ABK they'll continue 3rd in revenue in the whole gaming market, 3rd brand in console installbase and marke share, Sony will continue way above them in game subs, and there will be many above MS in PC and mobile. Like other major companies they'll barely have slightly above 10% of market share. There's no monopoly or competition issues at all with this acquisition.

 

[Bryank75]

MS shouldn't have any issue to complete the acquisition. There's no monopoly at all. Even including ABK they'll continue 3rd in revenue in the whole gaming market, 3rd brand in console installbase and marke share, Sony will continue way above them in game subs, and there will be many above MS in PC and mobile. Like other major companies they'll barely have slightly above 10% of market share. There's no monopoly or competition issues at all with this acquisition.

True but I believe if it hurts competition or the industry at all they can take action.

Also depends if they are looking at gaming as a market or a sub-segment. For instance they could take console gaming as an area that could be seriously effected. Or they could look at subscriptions and say it puts MSFT in too much of a dominant position going forward to where they can offer all those games for free on a subscription and nobody else can.....thus tilting competition too far in one direction.

 

[Yurinka]

True but I believe if it hurts competition or the industry at all they can take action.

Also depends if they are looking at gaming as a market or a sub-segment. For instance they could take console gaming as an area that could be seriously effected. Or they could look at subscriptions and say it puts MSFT in too much of a dominant position going forward to where they can offer all those games for free on a subscription and nobody else can.....thus tilting competition too far in one direction.

It doesn't hurt competition at all because they aren't market leaders and don't have a big control of the gaming market or any of the gaming markets.

If something, this acquisition would help them compete to be closer to be a market leader in maybe some gaming market.

In subscriptions MS isn't in a dominant position when Sony twice the subs of them. Regarding cloud gaming as I remember we don't have the MAU of people who uses cloud gaming on each platform so we can't compare.

 

[Bryank75]

It doesn't hurt competition at all because they aren't market leaders and don't have a big control of the gaming market or any of the gaming markets.

If something, this acquisition would help them compete to be closer to be a market leader in maybe some gaming market.

In subscriptions MS isn't in a dominant position when Sony twice the subs of them. Regarding cloud gaming as I remember we don't have the MAU of people who uses cloud gaming on each platform so we can't compare.

Oh yeah I know, I am just saying they could take various perspectives on it... it isn't quite as clear as monopoly or no monopoly....