Microsoft’s ongoing attempts to acquire Activision Blizzard was one of 2022’s biggest evolving stories, and one that shows no signs of slowing down. While the deal has been approved in several territories, investigations into the deal are ongoing in several key markets, including the UK.
While Microsoft has repeatedly claimed that the key reasoning for the deal is Activision Blizzard’s strength on mobile platforms, rival console developer Sony has claimed that it risks fostering an anti competitive environment should Microsoft decide to make the Call of Duty franchise, one of the most successful in gaming, exclusive to Xbox.
These protests have been taken seriously by regulators in various territories, including the UK, so the Competition and Markets Authority (CMA’s) decision to narrow the scope of its investigation to mobile devices was significant – however, Sony has issued a response to that decision, stating that, “the CMA’s reversal of its position on its console theory of harm is surprising, unprecedented, and irrational.
“The Provisional Findings (“PFs”) assessed a significant body of evidence in the round to support its finding that Microsoft would have the ability and incentive to withhold Activision content, and this would substantially lessen competition by foreclosing PlayStation.”
Is mobile all that matters?
Regardless of the mobile focus of the deal, the fact remains that Xbox represents a significant revenue stream for Microsoft. Notably, the CMA previously suggested that removing Call of Duty from the acquisition would pave the way for its approval of the deal, which Microsoft rejected. While the CMA is seemingly satisfied that Microsoft has no intentions to remove Activision Blizzard content from PlayStation, it appears that Sony has, once again, proven harder to convince.
While Sony’s observations regarding the CMA’s decision acknowledged that the group found that Microsoft faced a significant financial loss should it attempt to foreclose on its competitor, it stated that the CMA’s decision didn’t reverse the provisional findings that Microsoft would have the ability to foreclose PlayStation or its determination that such foreclosure would substantially lessen competition.
“As to Microsoft’s past behaviour following acquisitions, the Addendum does not include any new evidence calling into question the PFs’ original assessment. Rather, it notes that the CMA simply places ‘less weight’ on that evidence.”
We listed Activision Blizzard as one of the top 50 mobile game makers of 2022.
