The acquisition of Activision Blizzard by Microsoft is being a process full of chapters. After the approval of the operation in territories such as Brazil or Saudi Arabia, the purchase has hit a real wall at the UK competition commissionwhich has ordered an in-depth investigation of the treatment and the possible effects in terms of monopolistic effects that the acquisition of the company could bring about.
After knowing the conditions that Sony imposed to accept the purchase agreement of Activision Blizzard, now we have known what it was Microsoft’s response to the CMA on the accusations of possible monopoly in the event that the acquisition comes to fruition, especially highlighting Sony’s position in the market in recent years.
This is Microsoft’s response to the CMA on the possible existence of a monopoly with the purchase of Activision
As we have been able to find out thanks to Tom Warrenreputable journalist for The Verge, we can take a look at Microsoft’s response to the CMA on the possible existence of a monopoly with the purchase of Activision Blizzard by those of Redmond. In a series of images that the journalist has shared, we can take a look at the full statement that includes Microsoft’s position regarding the impediments that Sony is putting in place for the certification of the purchase.
These unsupported theories of harm are not sufficient to justify a reference to Phase 2. Microsoft is confident that, after an in-depth review, the CMA will conclude that there is no prospect that the Transaction will result in a material lessening of competition in any market based on the higher Phase 2 “balance of odds” threshold.
This is how Microsoft’s response to the CMA begins, in which it shows that it hopes that the reasons it will offer below will be more than enough for the body to rethink the possibility of sending the deal to a second phase, something that would delay the deal a lot of time.
Below is an excerpt from the most important part of Microsoft’s response to the CMA.
“CMA’s concerns are misplaced for the following reasons:
- Sony PlayStation has been the largest console platform for over 20 years, with an installed base of over 150 million consoles, making it bigger than Nintendo and more than twice the size of Xbox.
- Sony engages in conduct that reflects its market power in console games, including raising the prices of its consoles without fear of losing market share.
- The suggestion that the established market leader, with clear and enduring market power, could be squeezed out by the third largest provider as a result of losing access to a title is not credible. There are over 4,000 games available on PlayStation alone.
- The evidence shows that the number of PlayStation Monthly Active Users (“MAUs”) playing Call of Duty is not significant enough. Even without all those players (a highly unlikely outcome of a hypothetical foreclosure strategy), PlayStation’s player base would still be significantly larger than Xbox is today.
- Since the transaction was announced, Sony has acquired several game studios, including Bungie, developer of the popular online game Destiny 2, Haven Studios, Lasengle and Savage Games, and a minority stake in From Software, the developer of the largest game in the world. 2022, Elden Ring (among other hit games). This complements Sony’s existing minority stake in Epic Games, the publisher of Fortnite, a strong catalog of proprietary games, and an extensive portfolio of exclusive deals with third-party publishers. There were more than 280 first-party and third-party exclusive titles on PlayStation in 2021, almost five times more than on Xbox.
With this response, Microsoft hopes to put an end to a possible second phase of investigation, something that until this response seemed to be happening. For now, we will have to wait if Microsoft’s response to the CMA finally it serves or not to avoid this second procedure.