Microsoft's acquisition of Activision Blizzard has been a constant topic of discussion since its announcement back in January. Since then, various parties have expressed their concern over the acquisition, mainly on the grounds of healthy competition. No other company has been louder in going against it than Sony. This debate has been ongoing until now, with seemingly something new from each party each month, if not week. Keep reading to learn more about the current news regarding Microsoft's Activision Blizzard acquisition, along with Sony's response.
Microsoft's Activision Blizzard acquisition summary
For those unfamiliar with the details, let me give a quick summary of the events. Back in January, Microsoft announced that it would acquire Activision Blizzard for a whopping $68 billion. By buying Activision Blizzard, Microsoft is able to acquire the various IPs under it, such as Call of Duty. Of course, because of the sheer size of the acquisition, various regulatory bodies were called upon to see if the deal would be detrimental to the balance and competition. Saudi Arabia approved the acquisition back in August, as did Brazil just this month. The Competition and Markets Authority (CMA) in the UK has since then set March 1, 2023 deadline for the acquisition.
Sony, of course, would not take this lying down. Back in September, Sony called Microsoft out over their promise to keep Call of Duty on the Playstation for “at least several more years”. Sony said that it was only for three more years and that this was “inadequate on so many levels”. Call of Duty is one of the biggest gaming franchises in the world. It's understandable that Sony would be up at arms at the thought that it might become an Xbox Exclusive.
Microsoft and Sony's continuing debate
Now, there's a whole new debate taking place. This is after the CMA detailed its concerns regarding the effects of the acquisition.
“There is a realistic prospect of a substantial lessening of competition in gaming consoles, multi-game subscription services, and cloud gaming services.”
CMA is concerned that Microsoft having control over so many well-known and loved IPs could easily tip the scales in Microsoft's favor.
“The CMA is concerned that having full control over this powerful catalogue, especially in light of Microsoft's already strong position in gaming consoles, operating systems, and cloud infrastructure, could result in Microsoft harming consumers by impairing Sony's – Microsoft's closest gaming rival – ability to compete as well as that of other existing rivals and potential new entrants who could otherwise bring healthy competition through innovative multi-game subscriptions and cloud gaming services.”
Sony also added to the statement from the CMA. They said that even if Microsoft does keep its promise, the exclusive features and content it can potentially offer would likely pull players to them. After all, players love exclusive features and content. This, Sony said, could easily cause an unbalance in the competition.
Microsoft isn't happy with the UK's CMA regulator over its Activision Blizzard acquisition comments. It describes the regulator's concerns as "misplaced" and that it "adopts Sony’s complaints without considering the potential harm to consumers" 👀 🧵 1/3 pic.twitter.com/nIWuVqyvSW
— Tom Warren (@tomwarren) October 12, 2022
Unsurprisingly, Microsoft took offense to this. They criticized the CMA for “adopting Sony's complaints without the appropriate level of critical review”. They mentioned that Sony is actually in the lead in the console market, citing Playstation's install base of 150 million. This is compared to Xbox's install base of only 63.7 million, half of that of Playstation. They continued, saying that “while Sony may not welcome increased competition, it has the ability to adapt and compete. Gamers will ultimately benefit from this increased competition and choice”
Microsoft even goes ahead and quotes Sony's acquisition of Bungie and Haven, two well-known game-production studios. They went further as to say that Playstation had 280 first and third-party exclusive titles last year, which was nearly five times more than what Xbox had.
“Sony is not vulnerable to a hypothetical foreclosure strategy, and the Referral Decision incorrectly relies on self-serving statements by Sony which significantly exaggerate the importance of Call of Duty to it and neglect to account for Sony’s clear ability to competitively respond”
In short, Microsoft is calling Sony out for its somewhat hypocritical stance on the matter. Microsoft also reiterates its stance that it will keep Call of Duty on PlayStation consoles. They said that making it an exclusive would “tarnish both the Call of Duty Xbox brands”. Microsoft said that if any players decided to switch consoles, it would just be because Xbox was offering them that choice.
There are still around 5 months before the final decision regarding the acquisition passes down. Until then, we can only wait and see what else Microsoft and Sony will throw at each other.
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