UK antitrust authority is fine with Microsoft acquiring Candy Crush, and even for Call of Duty does not rule out 'access remedies': major progress since previous statements
The Competition & Markets Authority (CMA) of the United Kingdom has just announced its provisional findings according to which ( summary (...
From the lawyer covering it
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OK, with the info that we have so far, this would be the summary (looking forward to the long version of the PF during the day or tomorrow):
Provisional findings from the CMA:
- Short version
- Summary
- Long version not available yet
- Press release
The merger may be expected to result in a substantial lessening of competition in:
A) console gaming in the UK due to vertical effects resulting from input foreclosure; and
B) cloud gaming services in the UK due to vertical effects resulting from input foreclosure.
Possible remedies:
1) Requiring a partial divestiture of Activision Blizzard:
a) Divestiture of the business associated with Call of Duty;
b) Divestiture of the Activision segment of Activision Blizzard, which would include the business associated with Call of Duty;
c) Divestiture of the Activision segment and the Blizzard segment (the Blizzard segment) of Activision Blizzard, Inc., which would include the business associated with Call of Duty and World of Warcraft, among other titles.
2) Prohibition of the merger.
3) Access remedies will be considered:
18. Microsoft has, however, informed us of existing and potential contractual arrangements with third-party platforms relating to access to Call of Duty. Accordingly, while none of the circumstances in which the CMA would select a behavioural remedy as the primary source of remedial action in a merger investigation (as summarised in paragraph 15 above) appear to be present, the CMA will also consider a behavioural access remedy as a possible remedy.
19. Access remedies are a form of behavioural remedy which seek to maintain or restore competition by enabling competitors to have access on appropriate terms to the products and facilities of a merger entity that they require to remain competitive. Access remedies normally require an access commitment which is set out in significant detail so that both customers and monitoring agencies can enforce compliance effectively. In this case, an access remedy would look to ensure third party access to Activision Blizzard, Inc's content that is necessary to remedy the provisional SLCs.
44. As noted above, the circumstances in which the CMA might select a behavioural remedy as the primary source of remedial action are not present in this case. The two markets in which the CMA has provisionally found SLCs are multi-faceted and continue to develop. This is particularly the case in cloud gaming, where the customer offerings and business models of market participants are evolving rapidly. We are of the initial view that any behavioural remedy in this case is likely to present material effectiveness risks. We invite the Parties to provide evidence on how these risks could be appropriately managed to ensure that any behavioural remedy is effective.
Next steps
MS/ABK and interested parties have until 17:00 UK time on 22 February to respond to the remedies notice.
——————
OK, with the info that we have so far, this would be the summary (looking forward to the long version of the PF during the day or tomorrow):
Provisional findings from the CMA:
- Short version
- Summary
- Long version not available yet
- Press release
The merger may be expected to result in a substantial lessening of competition in:
A) console gaming in the UK due to vertical effects resulting from input foreclosure; and
B) cloud gaming services in the UK due to vertical effects resulting from input foreclosure.
Possible remedies:
1) Requiring a partial divestiture of Activision Blizzard:
a) Divestiture of the business associated with Call of Duty;
b) Divestiture of the Activision segment of Activision Blizzard, which would include the business associated with Call of Duty;
c) Divestiture of the Activision segment and the Blizzard segment (the Blizzard segment) of Activision Blizzard, Inc., which would include the business associated with Call of Duty and World of Warcraft, among other titles.
2) Prohibition of the merger.
3) Access remedies will be considered:
18. Microsoft has, however, informed us of existing and potential contractual arrangements with third-party platforms relating to access to Call of Duty. Accordingly, while none of the circumstances in which the CMA would select a behavioural remedy as the primary source of remedial action in a merger investigation (as summarised in paragraph 15 above) appear to be present, the CMA will also consider a behavioural access remedy as a possible remedy.
19. Access remedies are a form of behavioural remedy which seek to maintain or restore competition by enabling competitors to have access on appropriate terms to the products and facilities of a merger entity that they require to remain competitive. Access remedies normally require an access commitment which is set out in significant detail so that both customers and monitoring agencies can enforce compliance effectively. In this case, an access remedy would look to ensure third party access to Activision Blizzard, Inc's content that is necessary to remedy the provisional SLCs.
44. As noted above, the circumstances in which the CMA might select a behavioural remedy as the primary source of remedial action are not present in this case. The two markets in which the CMA has provisionally found SLCs are multi-faceted and continue to develop. This is particularly the case in cloud gaming, where the customer offerings and business models of market participants are evolving rapidly. We are of the initial view that any behavioural remedy in this case is likely to present material effectiveness risks. We invite the Parties to provide evidence on how these risks could be appropriately managed to ensure that any behavioural remedy is effective.
Next steps
MS/ABK and interested parties have until 17:00 UK time on 22 February to respond to the remedies notice.
Old but still relevant…
kotaku.com
Report: Microsoft Offered Sony Call Of Duty On PlayStation Plus
Microsoft is still trying to get its Activision purchase over the line
kotaku.com
One could use a mobile phone or even a TV for cloud gaming, how old and out of touch are these people?
www.gov.uk
The CMA provisionally found that buying one of the world's most important game publishers would reinforce this strong position and substantially reduce the competition that Microsoft would otherwise face in the cloud gaming market in the UK. This could alter the future of gaming, potentially harming UK gamers, particularly those who cannot afford or do not want to buy an expensive gaming console or gaming PC.
Microsoft – Activision deal could harm UK gamers
A CMA investigation has provisionally concluded that Microsoft’s proposed acquisition of Activision could result in higher prices, fewer choices, or less innovation for UK gamers.
The CMA provisionally found that buying one of the world's most important game publishers would reinforce this strong position and substantially reduce the competition that Microsoft would otherwise face in the cloud gaming market in the UK. This could alter the future of gaming, potentially harming UK gamers, particularly those who cannot afford or do not want to buy an expensive gaming console or gaming PC.
From the lawyer
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Mlex reports this from Activision:
"We hope between now and April we will be able to help the CMA better understand our industry to ensure they can achieve their stated mandate to promote an environment where people can be confident they are getting great choices and fair deals, where competitive, fair-dealing business can innovate and thrive, and where the whole UK economy can grow productively and sustainably."
I looks like we are going to be here until the end of April, at least
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Mlex reports this from Activision:
"We hope between now and April we will be able to help the CMA better understand our industry to ensure they can achieve their stated mandate to promote an environment where people can be confident they are getting great choices and fair deals, where competitive, fair-dealing business can innovate and thrive, and where the whole UK economy can grow productively and sustainably."
I looks like we are going to be here until the end of April, at least
Basically they want an actual contract in place of what MS promised in the first place. Then if Sony still cry the CMA can say well unlucky Sony take it or leave it.
The CMAs survey showed only 6% PS owners would consider buying a Series X/S or MS next console.
89% said they would still mainly buy on PS if COD wasn't on the system.
So..... the CMAs own evidence doesn't match what they said.
89% said they would still mainly buy on PS if COD wasn't on the system.
So..... the CMAs own evidence doesn't match what they said.
Eh, PS owners are full of s***. If COD wasn't on PS, the amount of Xbox consoles that sold would be through the roof.
Sony loves putting the boot on Microsoft's neck, they want to make sure no one is going to compete with them.
It's funny how some are already doing victory laps. I wouldn't if I were them. A 10 year agreement, in my opinion will suffice. There's gonna be some really hurt feelings between now and May.
Yeah, these are just their findings, with what seems to be with little research or knowledge of how things work, their interpretations of what they believe. But they’re aware of that, that’s why ms and abk are now given the opportunity to inform them within a timely and scheduled manner for their concerns.
Yeah, these are just their findings, with what seems to be with little research or knowledge of how things work, their interpretations of what they believe. But they’re aware of that, that’s why ms and abk are now given the opportunity to inform them within a timely and scheduled manner for their concerns.
From the lawyer
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The Open Markets Institute in Brussels (a non-profit organization on antitrust law) agrees with the CMA and says that behavioural remedies shouldn’t be accepted.
Some hot takes:
- No doubt that the deal is in a hard position right now, among others things because I don’t think that the merger agreement is in favor of these kind of divestments.
- In any case, if they still want to play the behavioural remedy card they have a very small window of opportunity, but it’s not going to be easy.
- They really need a win (the EC) and as soon of possible. The EC agreeing to access remedies could be a good argument to present to the CMA in favor of accepting behavioural remedies. But maybe not even that is going to be enough.
- I just skimmed the PF, but the arguments are quite similar to the ones from Phase 1.
- The CMA still believes in the high performance console market definition and Nintendo is still not part of the video game console market. I mean, they even say that: “Nintendo does not currently offer CoD, and we have seen no evidence to suggest that its consoles would be technically capable of doing so with a similar quality of gameplay as Xbox or PlayStation in the near future”.
- MS got a nice win with the subscription services definition, now Game Pass is just a different way to pay for games, no its own market.
- I always thought that the Windows - Azure combo was the weak spot of this deal and it definitely was a problem for MS here.
- Very interested to know how the SO from the EC and the PF from the CMA compare. Now that negotiations will formally begin, I guess that more info will start to leak about the SO.
More later if I have time.
Anyway, we are still 2-3 months away from the end
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The Open Markets Institute in Brussels (a non-profit organization on antitrust law) agrees with the CMA and says that behavioural remedies shouldn’t be accepted.
Some hot takes:
- No doubt that the deal is in a hard position right now, among others things because I don’t think that the merger agreement is in favor of these kind of divestments.
- In any case, if they still want to play the behavioural remedy card they have a very small window of opportunity, but it’s not going to be easy.
- They really need a win (the EC) and as soon of possible. The EC agreeing to access remedies could be a good argument to present to the CMA in favor of accepting behavioural remedies. But maybe not even that is going to be enough.
- I just skimmed the PF, but the arguments are quite similar to the ones from Phase 1.
- The CMA still believes in the high performance console market definition and Nintendo is still not part of the video game console market. I mean, they even say that: “Nintendo does not currently offer CoD, and we have seen no evidence to suggest that its consoles would be technically capable of doing so with a similar quality of gameplay as Xbox or PlayStation in the near future”.
- MS got a nice win with the subscription services definition, now Game Pass is just a different way to pay for games, no its own market.
- I always thought that the Windows - Azure combo was the weak spot of this deal and it definitely was a problem for MS here.
- Very interested to know how the SO from the EC and the PF from the CMA compare. Now that negotiations will formally begin, I guess that more info will start to leak about the SO.
More later if I have time.
Anyway, we are still 2-3 months away from the end
From another poster
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the 1397 PlayStation users sampled, 6% said they would buy an Xbox next.
When asked about the availability of titles on the platform, COD ranked nearly equal to PS Exclusives.
If COD wasn't on PlayStation, AND they would have bought an Xbox or PC to play COD, 89% said they would still buy games mainly on PlayStation!
how the f*** did the CMA conclude that COD going Xbox exclusive or even partially exclusive/better quality would substantially harm Sony's longer term revenue using this survey when saying 41% may buy an Xbox to play COD lmao
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the 1397 PlayStation users sampled, 6% said they would buy an Xbox next.
When asked about the availability of titles on the platform, COD ranked nearly equal to PS Exclusives.
If COD wasn't on PlayStation, AND they would have bought an Xbox or PC to play COD, 89% said they would still buy games mainly on PlayStation!
how the f*** did the CMA conclude that COD going Xbox exclusive or even partially exclusive/better quality would substantially harm Sony's longer term revenue using this survey when saying 41% may buy an Xbox to play COD lmao
Sorry Kvally this is 277 pages worth, it’s high school all over, I’ll post a video that sums it up, once one is released
www.gov.uk
Microsoft / Activision Blizzard merger inquiry
The CMA investigated the anticipated acquisition by Microsoft Corporation of Activision Blizzard, Inc.
From the lawyer
——————
Provisional findings from the CMA:
- Short version (2 pages)
- Summary (16 pages)
- Long version (277 pages)
- Appendices and glossary (43 pages)
- PlayStation gamer research (38 pages)
- Press release
Now we have more than 350 pages of new material. Enjoy!
——————
Provisional findings from the CMA:
- Short version (2 pages)
- Summary (16 pages)
- Long version (277 pages)
- Appendices and glossary (43 pages)
- PlayStation gamer research (38 pages)
- Press release
Now we have more than 350 pages of new material. Enjoy!