At least all the people with abandoned cybernetic eye implants (as a random instance of healthcare industry consolidation fuckery) will be able to play Call of Duty on PS5. Excellent use of government’s infinite resources.
Man, I wish I could get robot eyes. My organic eyes are hot garbage.
I know it’s not fair to expect everyone on the “the FTC are big meanies” side to have the same justifications for their position, but I’m gonna ask you to choose between these options here. Either this is small potatoes that doesn’t even matter, or it’s the cornerstone of the US economy, it can’t be both at the same time.
I’ll take a shot at this.
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tech companies are the cornerstone of American industry moving forward. If necessary, I can expand on why I think this, but it may not be controversial.
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in this particular case I do not believe the FTC’s argument is sound.
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in this particular case, we are talking about a particular niche of tech development, that isn’t really super critical to public welfare.
I do not see these three ideas at odds with each other.
They come together in the idea that there are groups that span the political spectrum who seem to harbor fairly deep resentment towards the large American tech companies, for a wide variety of reasons. From believing that those companies perpetuate some sort of evil American hegemony, or are bad for labor, or bad for consumersr, or are easy targets for broader criticisms of capitalism, to those who imagine conspiracy theories of the tech companies secretly silencing their political views. Certainly, these criticisms are true, to varying degrees, in varying specific cases.
These various groups then seek to damage those companies (or honestly, sometimes just give the appearance of such, for political cred).
In this case, it may be that the leadership of the FTC is using opposition to this merger in a narrow market, where the case clearly does not result in some sort of monopolistic control, as a vector to attack a company that is seen as “bad” from a broader, more abstract perspective. That is, the merger of these companies within the market of gaming isn’t really the issue, but rather that Microsoft, as a large American tech company, is bad and ultimately should not be allowed to get bigger.
All that said, bear in mind that the different folks here harbor different views about all this stuff, so they may say things which do not fit with things other folks say.
It’s about time someone took a stand for the ethnic group that is the most disempowered, the most discriminated against, mega-corporations.
(For the record, I don’t think Sony’s business practices are somehow better than Microsoft, and I’m not saying the Activision buyout necessarily should be blocked, but this is exactly the sort of deal that should be heavily scrutinized. There’s no reason to act like it’s somehow out of line for regulators to get involved and ask whether or not this is monopolizing a market segment).
But the FTC didn’t seem to care when Sony bought Bungie, despite Sony being the clearly dominant force in the same market.
Aren’t they moving on from the scrutinizing with the court case?
To me, this just seems like a weird point for the FTC to step in.
How can you, as the FTC, with a straight face, block this acquisition, less than 5 years after Disney bought Fox.
That deal feels the same amount of anti-competitive to me. They folded the Simpsons, Xmen (among other franchises) into Disney plus, making them exclusive.
It was a content and IP purchase on the same scale, yet somehow not a problem? If that wasn’t anti-competitive how is this?
Is it really weird that the FTC under different leadership and administration had different ideas than the current one? Particularly when the current FTC has already stated publicly that they intend to pursue riskier cases.
I think the FTC loses this case for all the reasons noted, but the EU sent a warning to MS a few days ago, so they’re not out of the woods yet.
Gaming is a huge industy, but doesn’t have political support is the way I would see this?
Having said that, it’s not like this is going to make a huge difference to MS’s bottom line either way. It’s just frustrating given the nature of the gaming industry and the other big players who have been buying things up that this is the case the FTC jump in on.
Are you seriously going to pretend you don’t see the distinction between Bungie and Activision?
From the Politico article:
“The move comes after the EU launched an in-depth investigation into the deal in November, finding that Microsoft may in the future be incentivized to block access to Activision’s popular “Call of Duty” franchise.”
So, are they planning to block everyone from doing exclusives, just Microsoft, or is Call of Duty a special snowflake?
Well, they may not even block MS. But the reasoning given when they opened the investigation was:
Presumably the same logic, at least as regards this concern, would apply to Sony buying ABK. Game streaming/subscription might be MS-specific (it is in the CMA’s stage one analysis).
Of course I do, but if I look at the overall size of the resulting organizations in this market, then
Sony+Bungie >Microsoft+Activision
If the acquisition is being prevented on the basis that the resulting corporation would have too much market control, then the Sony acquisition shouldn’t be allowed either. It’s a smaller acquisition, but their starting point is much larger.
Is Destiny a huge money maker, or was that just a poke MS in the eye by scooping up the people that made Halo?
It’s a good thing that that’s not the basis, then!
Instead it’s that:
- Activision’s content is extremely important for driving console adoption; probably uniquely so in the case of CoD.
- The purchase gives Microsoft the ability to block that content from the Playstation. They also clearly have the incentive to do so.
- Blocking that content would result in less competition and consumer harm.
Your analogue is already failing at the first point. Bungie is tiny. They’ve released two games in the last decade. Their estimated revenue when bought was $200M / year. Destiny is so irrelevant commercially that Activision just gave the publishing rights away to Bungie when asked. It’s just not that important for a console to have Destiny on it. Having CoD, FIFA and GTA is.
Let’s consider the big independent AAA game publishers left:
- Activision
- EA
- Take-Two
- Ubisoft
- Square Enix
That’s a short list. Microsoft already shortened it by one when they bought Zenimax. Either MS or Sony trying to buy anything on that list would probably meet with just as much resistance as this Activision deal. Anything not on that list? It’d probably be much easier sell.
(Am I missing somebody? Capcom might qualify, but is already substantially smaller than anything on that list. Bandai-Namco has a high gaming revenue but I don’t think much of it is from AAA in normal years. CDPR is tiny. Embracer is huge but my impression is that there’s very little AAA there, it’s just an amazing volume of AA shovelware some of which turns out to be surprise hits.)
But you already have evidence that Microsoft offered a deal to Sony for a decade of guaranteed deployment to the PlayStation.
Honestly, this idea that call of duty is somehow a unique commodity that justifies it’s own direct antitrust intervention is based on what? Is there some other analogue to that idea that we can see in legal history?
I mean, it’s one game.
But beyond that…
Ok, so you are arguing that the end result of the merger, in terms of overall corporate control of the market doesn’t matter, but rather that buying Activision is bad because they are large (rather than small like Bungie), let’s explore that some.
What if you broke Activision down first, and sold individual development groups within it to Microsoft, would that be ok? The end result of course would be the same, but individual acquisitions would all be small, like Sony’s acquisition of Bungie.
I was under the impression that the point of antitrust law was to prevent consolidation of corporate power in a market in order to prevent one company from having enough control over that market to manipulate it.
But given that Sony already had a dominant position in the market, and even the acquisition of Activision wouldn’t give Microsoft more control than Sony, I’m not seeing how you can say that the Activision acquisition is bad, but any Sony acquisition is ok, given that any acquisition by Sony will increase their already dominant position in the market.
If the amount of control that Sony has after acquiring Bungie is ok, I’m not sure how a different company having less control could be deemed unacceptable.
I don’t know what you’re asking, to be honest. I could interpret it as any of the following:
a) You’re suggesting that 3p titles are irrelevant to console adoption.
b) You accept that 3p titles have an impact, but that CoD isn’t particularly special, and there’s lots of substitutes
c) You accept that CoD has an abnormally high impact on the, but do not think any regulator should care about it
Can you clarify?
This question makes me think you don’t quite appreciate the scale differences. Call of Duty alone is like 10x the size of all of Bungie. (It is probably larger than all of Sony’s 1p games combined). A deal containing just CoD will be nothing like the Bungie deal.
Now, if Microsoft wanted to buy e.g. just King? I bet that’d be fine, since it’s a different and more competitive market. If they tried to buy an individual bit of IP and the teams working on it, e.g. Overwatch or Diablo? Seems unlikely from a business perspective that either side would be interested in such a deal, but I can’t imagine that getting a ton of regulatory scrutiny.
Some crazy scheme of the company temporarily splitting into multiple parts so that each part can be sold separately to the same buyer? No, of course that wouldn’t work! You’re falling into the classic engineer’s trap of thinking that the law is a mechanical system, and if you just find the right workaround there’s nothing anybody can do to stop it.
I think that obviously can’t be the sole point of antitrust law, since many (most?) anti-trust cases aren’t about consolidation of power. Nor do I think there’s any kind of defined threshold on what is / isn’t too much power. The case will get decided based on whether this specific merger significantly reduces competition, the only way the size of Sony matters is if Microsoft tries to make some case about not having enough scale in their games business to compete and Activision getting them that scale.
This seems hard to prove, considering both Sony Microsoft and Nintendo all do this already.