The CMA has released Sony and Microsoft’s full arguments on Microsoft’s proposed acquisition of Activision Blizzard. The two companies have been arguing for weeks, with Sony claiming that Microsoft’s ability to make Call of Duty an exclusive will hurt their business, and Microsoft responding by offering long-term commitments to keep the game available everywhere.
Sony says it agrees with the CMA’s initial findings. “He firmly believes that the Transaction will harm competition, industry participants, innovation and consumers.” The Transaction is what the purchase refers to, and it makes a lot of the business jargon sound great.
Sony says The Transaction is “a threat to an industry enjoyed by hundreds of millions,” could “cause significant harm to consumers, competition, and developers,” and “would hurt nascent competition in cloud gaming.”
Microsoft argues that The Merger, a softer brand important to win hearts and minds, “is fundamentally pro-competitive because it increases competition in a market long dominated by Sony.”
Microsoft is positioning itself as the underdog to convince the CMA that the merger should go through. “The suggestion that the current market leader, Sony, with clear and enduring market power, could be knocked out by the smallest of the three console competitors, Xbox, as a result of losing access to a title, is not is believable.”
Microsoft also adds that “the addition of Activision’s content to Xbox will, if anything, increase the chances that Xbox can more successfully compete with Sony’s PlayStation.”
It’s hard to choose sides between two multi-billion dollar international corporations, each trying to make as much profit as possible, so we won’t.
The EU is also looking at the deal very closely, so the trouble may not be over for Microsoft. The CMA also takes aim at Apple and Google for what it believes is a “duopoly” over mobile app stores and mobile browsers.