bitbydeath
Member
Can you link where they’ve said that?
Sounds like business suicide.
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Microsoft / Activision Deal Approval Watch |OT| (MS/ABK close)
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Sounds like business suicide.
Topher
Identifies as young
It was rumored that MS was looking into ways of closing despite the CMA. That was reported through MLex. Microsoft has not confirmed that either way.
RCU005
Member
Not only time for consumers, but also developers.
A song and a movie are just copies. You record it once and distribute it the way you want. Don’t need to do anything else!
Games need active development at least one year after it is released. Whether they need to patch bugs, add content, remove content, etc. it’s much more work to have a game in a subscription service than having a song or a movie.
Unknown Soldier
Member
bitbydeath
Member
That’s all I thought it was.
James Sawyer Ford
Member
It just means if they need to renegotiate the price will need to be much higher than what was signed in 2022
Mr Reasonable
Completely Unreasonable
I of course have zero real insight, but I don't see any possibility of Microsoft spending this amount of money and then reducing the number of COD games they release.
Sure, there's a possibility that another of Microsoft's studios could be assigned to or even pitch to do something with some of Activision's IP, but doing it at the expense of fewer COD releases? No chance.
Heisenberg007
Gold Journalism
You were literally using Phil's words trying to protect him -- that he said "case by case basis".
I posted the truth and receipts, and now you are triggered why I posted his actual quotes?
And a company is gonna make exclusives after spending $7 billion but will not make exclusives after spending $70 billion? At least try to have some logic in your arguments.
Helghan
Member
Well yeah... Because the company worth 70 Billion is worth that much due to being highly successful in the multi-platform market. Zenimax was also multiplatform, just not as successful. So it makes sense not to take everything away from other platforms. If ABK would only put their games on PC/Xbox they wouldn't be worth 70 Billion, and the question remains that if Xbox would do this, if that gap can be filled with more revenue from other sources for Xbox.
So assuming Microsoft will just make every ABK game exclusive is quite premature.
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Mr Reasonable
Completely Unreasonable
Yeah, the scale of the deal precludes making all games exclusive.
There's not much point in saying this though, it'll get ignored and the same people who tirelessly post the same arguments daily will continue, pretending they're having a conversation, rather than delivering a monologue.
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Ar¢tos
Member
If their contract specifically requires the CAT approval, then it is impossible to close the acquisition until the appeal is over, regardless of what happens with the FTC.
The only way to close the deal without the CAT is doing a new contract and that's basically impossible before July 18 (and they would still be target of the CAT fines).
Bitmap Frogs
Mr. Community
That’s not how it works mate. Foreclosing competitors is the point of the deal. Like Bethesda before. If all they cared about was gamepass Bethesda would be releasing on ps5.
This is just Microsoft playing their favorite game: Monopoly.
Heisenberg007
Gold Journalism
Heisenberg007
Gold Journalism
But then the same concept applies to Zenimax, right?
Zenimax was worth $7 billion because they published their games on Xbox, PC, and PlayStation. So why are they not putting all their games on PlayStation now?
Barakov
Gold Member
I hope its not too late but Happy Father's Day Daddy Phil!!
Mr Reasonable
Completely Unreasonable
There's absolutely no way that Microsoft's board would sign off on $70Bn for Xbox to make Actiblizzard games exclusive.
This deal would require more than Phil Spencer being chummy with Nadella to get done. It has to make financial sense. Absolutely nobody, even the most optimistic of Xbox fans, would say that Xbox has the potential to make enough money through exclusive games to pay for this deal in decades.
Shareholders and the board would revolt.
Zero chance.
But let's say that was the aim. Why $70bn for this publisher when they could buy a host of other publishers, or even just their IP and hire a bunch of 3rd parties to get it done without fear of M&A Rulings.
It doesn't make sense..
ulantan
Member
You would severally hurt your competitions revenue. That would be a big gain for Microsoft if they could force sony to change thier investment plans.
Mr Reasonable
Completely Unreasonable
It just doesn't work like that.
"We want to spend $70bn"
"Wow. That's a giant amount of money. One of the biggest entertainment acquisitions of all time. Ok, what sort of return do we get and over what period of time?"
"Sony will earn less money."
"..."
Heisenberg007
Gold Journalism
You know your argument might work if we hadn't seen the same song and dance with Zenimax's acquisition just 2 years ago.
Helghan
Member
No, because 7 Billion is a much lower number of which the gap is much more easily closed by the extra revenue it will create of revenue, and the branding it brings with it for Xbox. And if the gap isn't closed than it's more easily manageable for Xbox, compared to 70B of ABK.
Mr Reasonable
Completely Unreasonable
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Heisenberg007
Gold Journalism
So if lower numbers made it possible to make games exclusive, why isn't Minecraft exclusive?
- Mojang = $2.5 billion (not exclusive)
- Zenimax = $7.5 billion (exclusive)
Helghan
Member
Because Minecraft is the most successful game every created? So keeping it multiplatform earns them way more. Are you just now starting to understand what Phil Spencer means by deciding what to make exclusive on a case by case basis?
Not to mention Mojang was 2.5B for 1 single game
Zenimax isn't for 1 single game.
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drganon
Member
If all Microsoft cared about was money, the Xbox division would've been shit canned a while ago.
Mr Reasonable
Completely Unreasonable
If all they cared about was putting PlayStation out of business, they'd have made significantly bigger strides than they have.
drganon
Member
What do you think they're spending spree over the last few years has been? They're attempting to buy the biggest 3rd party publisher and before things started getting rough, we're bragging about wanting to buy more. It doesn't take a genius to figure out what their end goal is.
ulantan
Member
If you can reduce the possible investment of your competitor thier product will suffer. That's the goal suddenly the next god of war has to be a little more restrained that makes xbox games look better in comparison.
Sony
Nintendo
It's a big risk as well. You pave the way for your competitor to fill in the gap you left by pulling out a game of franchise.
Warzone/CoD is making serious money. Pulling that from Sony/PlayStation will lead to: less revenue for Microsoft ánd the chance for Sony to develop a competitor.
Less than a month to go until the current Microsoft/Activision deal expires.
This week should be interesting because there will be a shareholders meeting at Activision so the re-negotiation topic will definetly emerge in some way.
The FTC preliminary injunction process should also have some interesting developments.
Microsoft will definetly be pressured about what they're planning to do in the UK and why they asked for a quick resolution when it's impossible they'll solve their issues in the UK by July 18th.
We will also find out the argumentations from both sides. FTC will leverage what CMA did and will press on the fact that all the western major regulators agreed that the merger would kill competition in the cloud market if not regulated.
Microsoft will try to talk about consoles, the remedies they have offered and so on.
Quite frankly I think a lot will depend on how the judge will be swayed, both sides have arguments on their side.
This week should be interesting because there will be a shareholders meeting at Activision so the re-negotiation topic will definetly emerge in some way.
The FTC preliminary injunction process should also have some interesting developments.
Microsoft will definetly be pressured about what they're planning to do in the UK and why they asked for a quick resolution when it's impossible they'll solve their issues in the UK by July 18th.
We will also find out the argumentations from both sides. FTC will leverage what CMA did and will press on the fact that all the western major regulators agreed that the merger would kill competition in the cloud market if not regulated.
Microsoft will try to talk about consoles, the remedies they have offered and so on.
Quite frankly I think a lot will depend on how the judge will be swayed, both sides have arguments on their side.
Mr Reasonable
Completely Unreasonable
Mr Reasonable
Completely Unreasonable
Why doesn't God of War look so good?
"Well, it's because they can't afford to make it any better since Microsoft bought Call of Duty"
GHG
Gold Member
The data available suggests otherwise.
I've talked about this before here but beta (along with options IV) is the indicator to get a feel for what the concensus is on wall street in terms of how likely they feel an announced acquisition is to go through.
When everyone was convinced the deal was in the bag from a regulatory standpoint (April 2023) the stock's beta plummeted to <0.05 and the average daily range was ~$0.50. In other words the volatility collapsed out of the stock and what the general market was doing had no bearing on it at all - at that point it was seen as a low risk investment, particularly from an arbitrage standpoint.
To state there's no evidence regarding anything to do with the stock prices, trading patterns or readings such as beta is simply incorrect, everything available paints a picture and tells a story. I'm not going to share screenshots of exactly where I'm getting my data from because I pay a pretty penny for it but here are some tidbits that you can easily verify using publicly available information if you know how to calculate beta over any given time period:
- ATVI beta - 2 week period prior to acquisition announcement (2022-01-03 - 2022-01-14) : 0.6755
- ATVI beta - 1 week period after acquisition announcement (2022-01-18 - 2022-01-21, shorter trading week due to Martin Luther King Jr. Day, 4 days of data available): -4.5088
- ATVI beta - 1 week period, 2 weeks prior to CMA block (lowest weekly beta on record) (2023-04-17 - 2023-04-21) : -0.00736
- ATVI beta - 1 week period, first full trading week after CMA block announcement (2023-05-01 - 2023-05-05): 1.1455
I also have scatter and line plots available at my disposable which show there is a clearly defined "before" and "after" period in terms of the beta readings (before being prior to any regulatory concern). If you want data (beta readings) for any particular timeframe then let me know, I'll share the data.
What is important to know as far as the deal is concerned:
- Low beta (near zero) = good - lower volatility compared to the rest of the market, typically coincides with lower trading ranges, lower volume and narrower spreads, there is agreement on the current price and not many market participants are doing any kind of repositioning on the stock. The closer to zero the better, near zero readings signal little to no risk.
- Market equal beta (1 or near to 1) = bad - the market is treating it like any other stock. This indicates confidence in the deal is low, participants are trading it in line with expectations for the general indexes.
- High beta (far away from zero in either direction) = bad (unless it coincides with a big sudden move towards the agreed share purchase price of $95) - higher volatility compared to the rest of the market, higher trading ranges, higher volume, wider spreads, little agreement on what the current price should be, widespread repositioning.
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ulantan
Member
That's the point the amount of resources to develop a cod competitor would be staggering and if attempted would derail a lot of other development.
Bitmap Frogs
Mr. Community
It has the potential to turn game pass into a business the size of Netflix and foreclosing rivals means that unlike Netflix, the competition cannot take away our content.
There, board happy.
mansoor1980
Gold Member
anyone here check the guardian interview with phil spencer?
Helghan
Member
Yes, they don't really discuss the acquisition. He merely says he wants the industry to grow, and get a fair share of the cake. He doesn't care about "shrinking" Sony since he believes that doesn't push the industry forward.
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DeepEnigma
Gold Member
Consolidation is not how the industry grows.
I don't believe him on the "shrinking" part. They projected enough and their history as a company says otherwise.
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mansoor1980
Gold Member
bullshit
he is waiting for the verdict of this ABK merger block
drganon
Member
I'd respect him more if he dropped the fake nice guy act.
mansoor1980
Gold Member
not mine
“I don’t know if I did a great job,” he says of the chat. “My fundamental point was that we’re not here to grow at the expense of the other players. Our plan is to help grow the industry and obviously to get our share of that growth. Sometimes from members of the press, definitely from members of the community … you need your Spider-Man, you need your God of War, you need to go create a movie or a television series that’s as good as The Last of Us. And what I try to get through to people – and I don’t always do it the best way – is that’s not our strategy.
If we’re just growing and Sony’s shrinking, that doesn’t help anybody. Maybe if all you care about is Xbox success versus Sony’s success, but in terms of an industry, it doesn’t help Electronic Arts. It doesn’t help Ubisoft, it doesn’t help Fortnite. It doesn’t help anybody if all we’re doing is trading one customer for another customer on a different console.”
“I don’t know if I did a great job,” he says of the chat. “My fundamental point was that we’re not here to grow at the expense of the other players. Our plan is to help grow the industry and obviously to get our share of that growth. Sometimes from members of the press, definitely from members of the community … you need your Spider-Man, you need your God of War, you need to go create a movie or a television series that’s as good as The Last of Us. And what I try to get through to people – and I don’t always do it the best way – is that’s not our strategy.
If we’re just growing and Sony’s shrinking, that doesn’t help anybody. Maybe if all you care about is Xbox success versus Sony’s success, but in terms of an industry, it doesn’t help Electronic Arts. It doesn’t help Ubisoft, it doesn’t help Fortnite. It doesn’t help anybody if all we’re doing is trading one customer for another customer on a different console.”
Helghan
Member
I do believe him. If the industry grows by 100%, and Microsoft gets a bigger slice of the cake, Sony is still not shrinking. And that's what he means. He doesn't mean Sony should keep their marketshare, he means that Playstation division shouldn't shrink, which could still be the case if they lose marketshare but the market itself is bigger.
mansoor1980
Gold Member
really? if the market is so big then why did he say this last year “The way sony grow is by making Xbox smaller,”
DeepEnigma
Gold Member
Projection 101
Helghan
Member
Because he was talking about the current market, not the future market?
MS: "We want to grow the market" also MS: "VR market is too small to chase" . You don't want to grow the market, you want to own the market that's there.
If you cared about growth you would actually try to grow markets. It's about owning established markets to them so they buy the audiences/companies with established IPs.
If you cared about growth you would actually try to grow markets. It's about owning established markets to them so they buy the audiences/companies with established IPs.
Topher
Identifies as young
That was just sour grapes. Nothing more.
mansoor1980
Gold Member
dude is too emotional
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