Microsoft / Activision Deal Approval Watch |OT| (MS/ABK close)
- Status
Not sure what you're saying there. MS is competing, it can raise the price if it chooses but chooses not to because it has that luxury. Not because it can't do it.
It sees it as a way of getting massive customer growth with little effort to get long term gains in subs and game sales to recoup costs.
I hear you already but I don't agree with you because its pretty clear the price increase is due to the economic climate and not because it can afford to do it due to a dominant position. It's doing it because it can't afford it. Even with the increase this year its profit margins dropped. Try going and looking at their financial results maybe.
- OI margin: ~6%
(Last year was 12.8%)
You seem to think having to raise the price to a point of entry product in this economic climate is a luxury but being able to keep the price and eat the cost to boost marketshare of your walled garden is the luxury. Imagine being able to legally do predatory pricing.
Not sure why you are concentrated on platform holder instead of the publishers who raised prices before platform holders, but how many platform holders are there? Nintendo games remain high priced and do bigger volumes. Do you remember PS greatest hits titles for $20 that's due to volume. MS concentrate on subs, liveservice and Mtxs. It has nothing to do with dominant position, especially when you are competing for game sales.
you have rising dev cost and inflation yet prices had remained for 15yrs. All Publishers did this with their high budget games, it has nothing to do with platforms or dominant positions anywhere. The hikes were platform agnostic they were hiked on xbox too.
Look up predatory pricing. Their argument is that they can raise prices after lowered competition or foreclosure. You seem to think not being able to weather the economic shitstorm is the luxury when being able to weather it is the luxury.
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DenchDeckard
Moderated wildly
I'm a lamen and I've considered Hoeg to be down the middle but this is picking Sonys case apart to pieces. It makes them seem so desperate and exposes them for not believing in a game pass subscription until Microsoft did it and that they have put no effort into making a competing game to cod and just want to keep their "free" money coming in.
Yeah, I think Sony are fucked here and look pathetic.
SenjutsuSage
Banned
lol there's just too much that is in their favor historically.
They also pick apart one of the most dangerous claims made by CMA, in my view, the idea that the draw of Activision Blizzard's content can't just be simply measured by their market shares alone. But then Microsoft directly tackles that to demonstrate how not so different a COD gamer is from other gamers, also that they don't spend more, they play a range of genres, just shooters even if COD is their favorite franchise, and so much more. A ton of redactions with clear real data. Sony, for its part, has nowhere near the same degree of data to provide defending its claims. It paints a clear picture of one side being a whole lot more transparent than the other, which I think hurts Sony and helps Microsoft and Activision.
There's a lot more than this, but they effectively kill the claim that COD just does so much for a console, especially in regards to gamers purchasing other non COD titles, that it would be impossible for a system to remain competitive without Call of Duty. Microsoft tears all of those claims down with real data. And these are just snippets with many redactions for real data. This goes on for 111 pages compared to Sony's 22 complaint document. They simply don't have the kind of data to back up their claims that Microsoft and Activision does. It's all speculation and fear-mongering.
DenchDeckard
Moderated wildly
I advise all of us to watch that Hoeg law video.. he really breaks down how pathetic Sonys arguments are here.
We are in for a wild ride. Its going to be one for the ages.
We are in for a wild ride. Its going to be one for the ages.
ZehDon
Gold Member
In your previous post, you highlighted that if Microsoft wants to better compete, it can't raise its prices. This is the crux of the issue: against a deeply entrenched dominate player, you don't really have the "luxury" your pretending Microsoft does. They tried being the more expensive option last generation; didn't go so well.
Not really. The hardware price increase happened after inflation became an issue, so happy to agree with you there. However, the software increase happened before. Sony can afford to not increase the price of its software, because its posting healthy profits. It wants bigger profits, and it knows its dominant position affords it the ability to increase its prices, so its going to take advantage of that.
I explained why: a single publisher - like Activision, or 2k - can't instigate an industry wide price increase by leading by example. Sony on the other hand, as the largest platform holder, can. And, they did.
And yet, video games has never been more profitable. You're insinuating that developers and publishers have been shouldering increasing costs, allowing us access to cheap games. However, the industry has grown enormously in 15 years. A million seller fifteen years ago would've been considered a monster hit. Now, it's an indie darling on Steam. Dev costs and inflation certainly increased, but so too did the ability to generate revenue. There's a reason publishers are posting record profits.
I feel you're deliberating misunderstanding me here. Maybe I'm wrong, so I'll try to be clearer: Sony is electing not to weather the storm. They have the reserves to further loss lead on the insanely successful PS5, but they know they don't have to, so they're not. They increased the pricing in strategic markets to ensure they didn't raise the price in the biggest regions of their competitors. They absolutely can weather the storm, but why bother? Force your competitors to further loss lead while keeping your profits as high as possible; win-win. If Microsoft wants to compete, Sony wants it to cost them. This is a tactic that only a dominate player can use, because only a dominate player has the market share to allow them to price increase without decreasing demand.
anthony2690
Member
Feds likely to challenge Microsoft’s $69 billion Activision takeover
A lawsuit would be the FTC’s biggest merger challenge to date under Chair Lina Khan.
www.politico.com
The UK/EU really don't want this deal to go through
Stop cock blocking value to my game pass subscription, you're meant to be getting a good deal for us consumers, not protecting sony's dominance in the UK
Now I'm going to try talk everyone into buying diablo 4 or play alone
Hopefully they have an incredible ad campaign, that makes my friends want to pick up the game.
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https://www.politico.com/news/2022/...softs-69-billion-activision-takeover-00070787
Even the FTC seems positioned to say no.
Chances of this deal to pass without some serious restrictions are becoming really slim.
Even the FTC seems positioned to say no.
Chances of this deal to pass without some serious restrictions are becoming really slim.
SenjutsuSage
Banned
One of the bigger sony contentions restated by CMA was that they saw something from sony claiming larger engagement than what Microsoft and Activision said. Well, Activision has provided the numbers to CMA through Microsoft that includes Playstation data. And apparently, it must contradict what Sony has been telling CMA, or else Microsoft and Activision wouldn't show it. So either Sony is not telling the truth, or they're telling the truth and somehow Activision bizarrely has incorrect data about their own game's performance on Playstation, which would suggest they didn't get paid what they were supposed to from Sony for the game's performance.
More likely scenario? Sony's numbers are heavily finessed more than normal because Activision almost definitely is going to know what what's going on with their games by platform. They've been at it too long to not have systems in place to track all this stuff.
And then they provide information that we all already knew, but clearly they go into more specific details of the deals Microsoft has signed with Activision and what Sony has signed, and yet despite Microsoft having exclusive deals with Activision, Sony's market share advantage increased over Xbox, basically killing Sony's entire argument about the power of Call of Duty's ability to foreclose their ability to compete, even on a partial basis.
It really does look like all Sony's biggest arguments on how much COD going to Microsoft, even exclusively, would hurt them, have been torn apart by actual data from Microsoft and Activision. Even assuming Sony's methodology is different, it can't be drastically different enough to alter the data. Any sane person knows Sony is being intellectually dishonest that they can't compete without Call of Duty. Look at God of War: Ragnarok right now. Fastest selling Playstation first-party game ever. That has to be nuts.
Sony would need to lose 100% of COD gamers (impossible) and a sizeable chunk of non COD gamers in order for them to be where Microsoft is in terms of total users, and somehow Microsoft still competes despite that. So how again will Sony not be able to compete if Microsoft already is while being much less successful? CMA has no answer for that. Sony doesn't either. Nobody does.
And can there be a stronger argument against network effects than the one encircled below? Why would the smaller console expanding cause developers to lose interest in the leading platform? The answer is that there is no answer for this question that is helpful to Sony. So this, among other things, is why I've never had any faith in this deal being stopped on the merits.
And personally, page 35 and 36 alone of Microsoft's latest submission kills any chance of this deal being stopped. At best I see a reasonable undertaking or consent agreement coming out of this from major regulators. No reasonable regulator is going against this much extensive data disproving every point they laid out in their phase 1. COD is certain to be a bigger deal in the USA, so things will get more interesting here, but even in the USA, the numbers will still align in a way that proves what Sony is saying is incorrect.
More likely scenario? Sony's numbers are heavily finessed more than normal because Activision almost definitely is going to know what what's going on with their games by platform. They've been at it too long to not have systems in place to track all this stuff.
And then they provide information that we all already knew, but clearly they go into more specific details of the deals Microsoft has signed with Activision and what Sony has signed, and yet despite Microsoft having exclusive deals with Activision, Sony's market share advantage increased over Xbox, basically killing Sony's entire argument about the power of Call of Duty's ability to foreclose their ability to compete, even on a partial basis.
It really does look like all Sony's biggest arguments on how much COD going to Microsoft, even exclusively, would hurt them, have been torn apart by actual data from Microsoft and Activision. Even assuming Sony's methodology is different, it can't be drastically different enough to alter the data. Any sane person knows Sony is being intellectually dishonest that they can't compete without Call of Duty. Look at God of War: Ragnarok right now. Fastest selling Playstation first-party game ever. That has to be nuts.
Sony would need to lose 100% of COD gamers (impossible) and a sizeable chunk of non COD gamers in order for them to be where Microsoft is in terms of total users, and somehow Microsoft still competes despite that. So how again will Sony not be able to compete if Microsoft already is while being much less successful? CMA has no answer for that. Sony doesn't either. Nobody does.
And can there be a stronger argument against network effects than the one encircled below? Why would the smaller console expanding cause developers to lose interest in the leading platform? The answer is that there is no answer for this question that is helpful to Sony. So this, among other things, is why I've never had any faith in this deal being stopped on the merits.
And personally, page 35 and 36 alone of Microsoft's latest submission kills any chance of this deal being stopped. At best I see a reasonable undertaking or consent agreement coming out of this from major regulators. No reasonable regulator is going against this much extensive data disproving every point they laid out in their phase 1. COD is certain to be a bigger deal in the USA, so things will get more interesting here, but even in the USA, the numbers will still align in a way that proves what Sony is saying is incorrect.
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Ass of Can Whooping
Gold Member
lol there's just too much that is in their favor historically.
They also pick apart one of the most dangerous claims made by CMA, in my view, the idea that the draw of Activision Blizzard's content can't just be simply measured by their market shares alone. But then Microsoft directly tackles that to demonstrate how not so different a COD gamer is from other gamers, also that they don't spend more, they play a range of genres, just shooters even if COD is their favorite franchise, and so much more. A ton of redactions with clear real data. Sony, for its part, has nowhere near the same degree of data to provide defending its claims. It paints a clear picture of one side being a whole lot more transparent than the other, which I think hurts Sony and helps Microsoft and Activision.
There's a lot more than this, but they effectively kill the claim that COD just does so much for a console, especially in regards to gamers purchasing other non COD titles, that it would be impossible for a system to remain competitive without Call of Duty. Microsoft tears all of those claims down with real data. And these are just snippets with many redactions for real data. This goes on for 111 pages compared to Sony's 22 complaint document. They simply don't have the kind of data to back up their claims that Microsoft and Activision does. It's all speculation and fear-mongering.
I'm sorry for your loss
MasterCornholio
Member
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GHG
Gold Member
Well I'm not sure where people go from here, we've got at least another 5 months of this.
Bonsaibäumchen
Member
MasterCornholio
Member
I'll never forget that thread.......
I highlighted that it chooses to grow market share massively but can still raise prices and remain competitive. You are saying it can't afford to raise prices like a dominant player in this economic climate and that's not true.
Have you tried looking at the link I sent you that's from 2020?
https://arstechnica.com/gaming/2020/07/the-return-of-the-70-video-game-has-been-a-long-time-coming/
It has a constant dollar comparison that game prices haven't really increased even in 2020.
That's with rising cost of game development too. Did you ignore that Sony's profit margins declined? It's not posting bigger profits.
Based on what? Publishers 'instigated' it on xbox didn't they? Surely the people on xbox who couldn't give a rats ass about PS would say fuck this and not buy those publishers games. Sony didn't instigate it. It just followed the same business model of projected sales, inflation and dev cost for their games as some other publishers particular games. Especially as most of Sony's games were less likely to have mtx to recoup the inflation and dev cost increases.
Sony are not posting record profits from game sales. Its Playstation OI margin is a measly 6%, down 50% from before. Sure other publishers are posting massive OI through mtx but if you look at Sonys financial reports rising dev cost, FX and declining premium game sales is an issue for them. Go look at Sony's OI margin vs say Take2, EA or Activison.
Sony is not electing to increase it any more than MS is electing not to.
If Sony could have increased the price without fear of competition it would have priced it higher at launch. It knows it has competitors but it also doesn't want to start posting losses quarterly. Sony is doing it because it knows it would be financially disastrous for them if they dont. They had a drop to 6% OI margin even with the increase. Imagine the OI margin without it. It would be at odds with their strategy too, it would lead them to posting losses every quarter if they want to increase hardware sales. They want to produce and sell as many PS5s as possible to remain as competitive as possible long term but that increased hardware sales leads to MORE loss. During the PS4 launch Sony sold a lot of its assets to be able to maintain losses on PS4 hardware sales too.
I take issue with MS' (and your) idea of increasing the price in this economy being an abuse of a dominant position. To you abusing a market position seems to just be posting very low profit margins even with increased price due to economic climate. Regulators should see right through that.
The ability to be able to loss lead more for an install base is the dominant position. Especially if you need money to compete in supply and a consolidating market where a competitor is making billions of dollars acquisitions.
PS5 success is great but it's not making money on the consoles. MS are not "forced" to keep it lower either. They choose to because it sees it as an opportunity to gain huge market share during this Holiday while not really competing on other fronts and it can afford to do it. It's aim is to weather the loss and persuade them to get an xbox instead. You can't be saying Sony is abusing a dominant position to "increase profit margins" when its profit margins declined 50% with the increase. Its aim is to not start posting losses quarterly and produce as many consoles as possible even if that may mean market share loss. It's not a luxury.
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freefornow
Member
Watch PS outsell Xbox this holiday. Demand for PS is still high.
The_Mike
I cry about SonyGaf from my chair in Redmond, WA
Can anyone explain to me why Sony has monopoly on buying studios and Microsoft probably aren't allowed to do the same?
Only difference here is who's buying, and the cost of the acquisition.
The offered price shouldn't affect the deal going through.
From what I've learned in here, destiny 2 is on par as being on par with Call of duty, yet Sony swooped Bungie right under this acquisition.
So it seems like Sony is heavily in favor everywhere, having monopoly on literally everything.
I am well aware that Sony have said that destiny 2 will still support other platforms - like current Cods will.
Do we know if the next Bungie games won't be exclusive? Destiny 3, or some other product.
FTC isn't protecting consumers, they are protecting corporations lol.
Only difference here is who's buying, and the cost of the acquisition.
The offered price shouldn't affect the deal going through.
From what I've learned in here, destiny 2 is on par as being on par with Call of duty, yet Sony swooped Bungie right under this acquisition.
So it seems like Sony is heavily in favor everywhere, having monopoly on literally everything.
I am well aware that Sony have said that destiny 2 will still support other platforms - like current Cods will.
Do we know if the next Bungie games won't be exclusive? Destiny 3, or some other product.
FTC isn't protecting consumers, they are protecting corporations lol.
Yeah they get the CMA on their side lol.
SenjutsuSage
Banned
Well, I'll say this much with confidence. If anybody bothers to read Microsoft's full 111 page submission to CMA, you will know the chances of this being blocked successfully are impossible, and would step into absurd territory with how strong the data and evidence is contradicting every single thing mentioned by both Sony and the CMA. Microsoft is literally in the documents also demonstrating how they're supporting Linux for games and Chromebook with Game Pass when Microsoft's multi-product eco-system is brought up.
People don't have to read it all, but they pack that shit with significant evidence after significant piece of evidence. Even all the redactions that point to real data, the accompanying language around those redactions makes crystal clear that it is proving Microsoft and Activision's points convincingly in a way that almost certainly has to have CMA, if they read it (which they will), question heavily the phase 1 inadequate conclusions. I find it difficult at the end of that document CMA won't come away thinking the deal has to be approved. They may still want a concession or two, but I don't think it will go all that far as to hurt the value of the transaction for Microsoft.
Ass of Can Whooping
Gold Member
Bruh
The_Mike
I cry about SonyGaf from my chair in Redmond, WA
Come on man, I know they have acquired in the past, but seems like they aren't allowed to be in that ball park with Sony.
But tell me, enlighten me why Sony were allowed to buy Bungie at the same time as this acquisition, where Microsoft aren't?
MasterCornholio
Member
You do this a lot though. Plus it seems like yoy repeat yourself a lot. Which is why I called it spam.
Also you really believe the CMA is corrupt?
Bonsaibäumchen
Member
First off: theres a difference of buying studios vs buying publishers.
Then one should also differenciate between the impact each single publisher and or studio has.
You would probably agree that theres a huge difference between lets say Team Asobi and Take2 .
GHG
Gold Member
Sony currently has 19 active development studios that they own, Microsoft have 23.
If Microsoft want to acquire more studios then there is nothing stopping them from doing so.
Where do you get the idea that acquiring Activision Blizzard is on the same scale as the acquisition of Bungie?
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The_Mike
I cry about SonyGaf from my chair in Redmond, WA
Isn't Bungie a studio though?
They are developing Destiny 2?
Both Activision and Blizzard works as studio and publisher at the same time.
Nothing stops Bungie from doing the same.
I know well that destiny 2 isn't a system seller by any means, and call of duty would be.
But who has most system sellers? Microsoft or Sony?
SenjutsuSage
Banned
I said they were corrupt. I suppose it's not impossible i could have said that, but those phase 1 conclusions were ridiculous enough to the point of LOOKING corrupt, but the reason why I ultimately don't take it that seriously is because I always knew the deal was guaranteed to go to phase 2. Even recklessly adopting all of sony's most self-serving fears is technically part of their job, as it helps them to establish an extreme baseline from a party that desperately doesn't want the deal to go through. It's an excellent starting point for Microsoft and Activision and Blizzard to use to prove their case. Being able to successfully do this is a surefire way of guaranteeing to the CMA that they've left no stone unturned in all potentially relevant areas. CMA are doing their job. It doesn't make what they said in Phase 1 any less ridiculous, but you don't have a way of getting to the truth if you don't lay down some markers, and that's exactly what CMA did.
So their phase 1, to me, reflects their overall view that the deal had to progress to phase 2 no matter what due to the sheer size and price tag of it all. They just used Sony's arguments and concerns as the foundation, which I actually find fantastic since I believe many of sony's complaints are ludicrous. I'd be a lot more afraid of the end outcome if Sony's arguments were not so self serving and way out there. It effectively gives Microsoft easy targets to pick and knock down in a fashion that makes the "balance of probabilities" standard for phase 2 completely fall in their favor.
Ass of Can Whooping
Gold Member
Sony hasn't bought studios at the same scale as Microsoft even without considering ActiBliz
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Bonsaibäumchen
Member
Currently? Both have nearly balanced IPs in hands. I would say, maybe MS already has the upper hand considering they own Minecraft, Bethesda, Obsidian, ID and so on.
Once they get Activision Blizzard they could lock sony out of all that content.
THAT is a huge deal. They could easily leverage that much power to push sony around.
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Are you even serious?
A 3 billion publisher with a single IP vs the biggest publisher in the industry with a 70 billion market value controlling some of the biggest games and studios in the industry including the best selling game on the competitor's platform?
How that is even remotely comparable in terms of impact on fair competition?
Also Sony has bought Bungie under the clear conditions to leave them independent.
The reality is simple and clear.
Microsoft simply tried to fly too high with their plans to buy a dominant position in the gaming subscription market and they're now getting burnt by antitrust. This deal won't pass without them accepting to keep things multiplatform or continue to let Activision operate like an independent subsidiary.
They should have kept a lower profile and continue to absorbe an other couple of Bethesda sized publishers. But the Spencer&Nadella duo made the wrong calculations probably also misguided by a Kotick who just wanted to escape from his scandals while getting money in the process.
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MasterCornholio
Member
You know Sony doesn't own the CMA right?
GHG
Gold Member
All of ATVI's individual studios:
- Blizzard Entertainment
- King.com Limited
- Major League Gaming Corp.
- Activision Blizzard Studios
- Activision Blizzard Consumer Products Group
- Beenox
- Demonware
- Digital Legends Entertainment
- High Moon Studios
- Infinity Ward
- Raven Software
- Sledgehammer Games
- Solid State
- Toys for Bob
- Treyarch
Anyone who attempts to do an acquisition of this scale would get this level of scrutiny, regardless of industry and the purchasing power of their respective competition.
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Bonsaibäumchen
Member
If this endangers competition, promotes monopoly status and is eventually bad for consumers, then yes.
Is it really so hard to understand? Just because they can afford it but all their competitors can't dosn't mean they should be able to.
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The_Mike
I cry about SonyGaf from my chair in Redmond, WA
So Sony dictates whats allowed to set the scale.
If Sony can afford it, OK.
If Sony can't, not ok.
Minecraft seems to stay multi platform.
Ms bought Minecraft, but has released every spin off on both Nintendo and Sony consoles.
ESO will remain on other consoles as well.
I'm aware that Activision is way bigger than Bungie, but if Sony could afford Activision Blizzard then they would without a doubt.
They are money hatting every thing they can in regards of call of duty, of course th would try to buy the entire company if they could.
And they could probably get away with it.
Ass of Can Whooping
Gold Member
This has fuck all to do with whether Sony can afford it or not. Come on bruh. These are some piss poor arguments
This is just unconsequential and unproven speculation vs the reality that one is trying to use their financial power to buy a dominant position in gaming while the other has left the only (small) publisher they bought independent and multiplatform without the antitrust telling/forcing them to do so.
feynoob
Banned
Price point of $68b.
Put Sony aside for a second.
Do you think spending that much money is fair?
Ass of Can Whooping
Gold Member
Hilarious to read "scale" is suddenly a factor when the same crowd is always comparing buying timed exclusivity to million dollar AAA productions like Square Enix for two years to three month indie exclusivity windows stating that they're the same.
Scale has always been a factor in M&A regulation
Shocking i know
Banjo64
cumsessed
?
Zenimax alone (never mind when you pair Bethesda and id Software with Obsidian, Double Fine and Playground) took them above Sony's first party for me.
As to your point, the same reason MS were allowed to buy Bethesda without scrutiny, the purchase didn't trigger regulatory scrutiny.
GHG
Gold Member
I'm starting to understand why people repeatedly get so upset when reality hits. You're not living in the real world.
What exactly are they "moneyhatting" other than the same bunch of shit companies typically get when doing marketing deals with publishers?
The_Mike
I cry about SonyGaf from my chair in Redmond, WA
Do you seriously believe Microsoft were allowed to buy Activision Blizzard for 8 billion?
feynoob
Banned
They have 3 of the most popular games on consoles.All of ATVI's individual studios:
Activision Blizzard as a company are so large that they are split into 5 business units.
- Blizzard Entertainment
- King.com Limited
- Major League Gaming Corp.
- Activision Blizzard Studios
- Activision Blizzard Consumer Products Group
- Beenox
- Demonware
- Digital Legends Entertainment
- High Moon Studios
- Infinity Ward
- Raven Software
- Sledgehammer Games
- Solid State
- Toys for Bob
- Treyarch
Anyone who attempts to do an acquisition of this scale would get this level of scrutiny, regardless of industry and the purchasing power of their respective competition.
Warzone, COD yearly releases, and overwatch 2. That alone tips the balance.
feynoob
Banned
No, but that price point is face of this deal.
It shows what MS can do in the long term, if they are willing to spend $68b now.
The_Mike
I cry about SonyGaf from my chair in Redmond, WA
Can't really say anything other than you are in the minority there.
Time will tell if elder scrolls 6,next fallout o even Starfield will be system sellers.
I mainly discuss on Gaf and no where else, and by the look of it neither of those titles are system sellers.
I know everyone owns Skyrim, possibly several releases, but when has Skyrim's re releases last been on the charts?
GTA V shows its possible, and that's the base game without any remasters etc.
Tiago Rodrigues
Member
I...what?
All of Sony's acquisitions were studios that were either developing exclusively for them or something like Bungie, which it has been guaranteed they will remain multiplatform, lmao. That's why the deal went through without a problem. Hell PlayStation's latest acquisition was a studio that never released a videogame before.
Activision acquisition ALONE is worth more than EVERY acquisition Sony has done together and money would still be left to spend on other stuff.
Stop talking about the trilionaire company as some sort of an underdog. Bethesda alone is a bigger acquisition than anything Sony has ever acquired. Join Activision and MS already owns god knows how many 3rd party IPs.
What 3rd party IPs does Sony hold at the moment? I'm honestly curious...
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