Microsoft plays the ugly duckling to justify its acquisition of Blizzard against the competition regulator

Last month, the Competition & Markets Authority (CMA) decided to analyze in more depth the acquisition of Activision Blizzard Entertainment by Microsoft. A first decision by the British authority made public is in fact unfavorable to this takeover, a judgment that Microsoft does not appreciate and decides to dismantle, point by point, in a document provided to Ars-Technica.

The CMA was initially concerned about the leadership in video game licensing that such an association could create, leaving little room for competition. An argument to which Microsoft responds that “The CMA’s theories of harm tie into a major concern: Activision Blizzard’s catalog of games — specifically the franchise Call of Duty— would allow Xbox to squeeze out its competitors in gaming markets. This concern is misplaced. The order for reference fails to recognize the incredible array of popular and diverse gaming content that is available to market participants and overstates the importance of Activision Blizzard’s content to competition in gaming markets.

call of dutya not so formidable weapon

The CMA also questioned the power of the license call of duty, which brings together tens of millions of players each year across the globe. To this, Microsoft responds that even if all fans of call of duty on PlayStation migrated to Xbox, the number of players on the Japanese console would remain higher than on the North American console. For Microsoft, “Call of Duty is not important enough”. Microsoft even sheds light on the power of the games catalog offered by Sony: “Since the announcement of the transaction, Sony has acquired several game studios […] There were over 280 exclusive titles […] on PlayStation in 2021, almost five times more than on Xbox.

Handkerchiefs for tears and blood

For the rest of its argument, Microsoft attacks Sony. “The biggest console platform for over 20 years” is criticized by the company on its hold on the market: “Sony is adopting a behavior today that reflects its power in the game console market, in particular by raising the prices of its consoles without fear of losing market share.” The company continues: “While Sony doesn’t welcome increased competition, it has the ability to adapt and compete. Ultimately, players will benefit from this competition and increased choice.”

Players, and therefore consumers, who are also brought back to the table by Microsoft in its criticism of the CMA: “If consumers decide to switch from a gaming platform, which doesn’t give them a choice of how to pay for new games (PlayStation), to one that does (Xbox), that’s the kind change in consumer behavior that the CMA should consider […] and even encourage. This is not something the CMA should be trying to prevent.”

If Microsoft shows its fangs, it’s not to threaten the CMA, but to show that its fangs are much less big and sharp than those of Sony.

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