#162: Woe is me
In the battle for Activision Blizzard, Microsoft and Sony are fighting over which of them is the bigger loser.
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I’ve been reading Microsoft and Sony’s latest submissions to the UK antitrust watchdog, the Competition and Markets Authority, because I am a super-cool guy. The CMA isn’t set to report the results of its deeper phase-two investigation until March, but on Wednesday it published irritatingly well-redacted copies of Microsoft and Sony’s most recent statements that make each company’s strategy pretty clear. With Politico now reporting that the US Federal Trade Commission is likely to block Microsoft’s purchase of Activision Blizzard, it felt like a good time for me to get a sense of the lay of the land.
Needless to say I have no idea whether the deal will go through, even after reading Sony’s 22-page statement and the 111-page (!) whopper Microsoft submitted to the regulator. I am no lawyer, and while I like to think I know my way around the game industry and its history, this deal is clearly unprecedented. I am some way out of my comfort zone. Regardless of my legal expertise, reading this stuff has been at once unedifying and eye-opening, and as hilarious as it has been depressing. In fact, I am amazed either company is in the videogame business, on this evidence. They appear to be terrible at it, and are at great pains to make their many failings clear.
The core of Microsoft’s argument, as it seeks to persuade regulators to let it spend $68.7bn on the biggest acquisition the game industry has ever seen, is that Xbox is a minnow. There are repeated references to it being in third place in console market share. It admits its firstparty games cannot hold a candle to those on PlayStation. Game Pass is a load of nothing, supposedly — it hasn’t cut through at all — and the statement cites Google’s closure of Stadia as evidence that cloud gaming is small beer. Yes, it both wants and is able to spend almost $70bn despite all that, but that’s not the point. The point is: we suck, and we need help.
Sony, meanwhile, presents Call Of Duty as the vital load-bearing pillar of the PlayStation business, the removal of which would see the whole thing collapse into a fine powder. Forget the runaway market-leading position and the hundreds of millions of PlayStations sold; ignore the eight-figure sales volumes of its firstparty blockbusters, the vast thirdparty library and the pipeline of paid-for exclusives. None of it means anything. Take Call Of Duty off PlayStation, and it will all be Thanosed out of existence.
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