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Microsoft is buying Activision Blizzard for $68.7 billion [FTC sues to stop - CMA issues updated preliminary findings]


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It's been a while since I've kept up with the news surrounding this, quite frankly because I was getting bored with the whole thing. It's probably for the best because some of the responses and arguments I'm seeing from AB and Microsoft executives is fucking unhinged. Like seriously I'm convinced they all have a mental illness. Some of the arguments from Sony have been dumb as shit as well but these other people are on another level. I'm still hoping the deal falls through spectacularly but I guess it's all still up in the air for the time being. 

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11 minutes ago, Deadvember said:

I'm glad it's been stopped, the more multi platform games the better. Microsoft owning them has no positive effects, only negatives for the consumer.

MS have almost 200 studios, about time they spent the $70 billion and made some AAA games worth playing.

 

It hasn't been stopped yet. The FTC's case against Microsoft for violating the Clayton Act starts in August, so while the FTC is seeking to block the merger, the companies are given their day in court to make their case.

The CMA also hasn't stopped anything yet according to their preliminary findings. They're going to make one of three suggestions: Prohibit the merger, allow the merger but force part of Activisions business to be separated as a separate entity than Microsoft, or define promises the merged company has to agree to.

The CMA is taking responses for one part of their findings until the end of February, and another part until the end of March. They'll reach their ultimate conclusion some time after that.

Far from definitively stopped so far.
 

 

35 minutes ago, Cryogenicide_X said:

Does anyone think that Microsoft in the end will just pull out of this deal and move on?

 

Nope. MS is going to ride this out as long as possible.
 

 

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On 1/18/2022 at 8:05 AM, StingX2 said:

Microsoft essentially acquired

  • Call of Duty
  • Crash Bandicoot
  • Diablo
  • Gabriel Knight
  • Guitar Hero
  • Interstate 76
  • Jawbreaker
  • King’s Quest
  • Laser Blast
  • Lost Vikings
  • Overwatch
  • Pitfall
  • Police Quest
  • Quest for Glory
  • Rock N’ Roll Racing
  • Skylanders
  • Soldier of Fortune
  • Space Quest
  • Spyro
  • Stampede
  • Starcraft
  • Tony Hawk's Pro Skater
  • Warcraft
  • World of Warcraft
  • Zork

Literally zero interest in any of those games.... I mean, Starcraft potentially...but yeah, all the rest.... Yawn. 

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12 minutes ago, Rozalia1 said:

If they can't convince the CMA to let it through then the deal is dead

 

Are you able to provide a clear explanation as to why specifically the CMA is singularly able to stop two US companies from merging? I'm not able to find any historical examples, if you know of any, where they have stopped or unwound two US companies from a merger? 

I was looking for precedent for your claims, but I have only found EU companies or UK companies and very, very few examples, some are still tied up in courts. And it looks like companies can ignore the CMA and just pay financial penalties if they choose so I'm looking for clarity on your descriptions of what they can do or have done with specific cases.
 

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2 hours ago, DaivRules said:

 

Are you able to provide a clear explanation as to why specifically the CMA is singularly able to stop two US companies from merging? I'm not able to find any historical examples, if you know of any, where they have stopped or unwound two US companies from a merger? 

I was looking for precedent for your claims, but I have only found EU companies or UK companies and very, very few examples, some are still tied up in courts. And it looks like companies can ignore the CMA and just pay financial penalties if they choose so I'm looking for clarity on your descriptions of what they can do or have done with specific cases.
 

 

Well if ignored the CMA would go the pentalty route. The CMA fined Meta £1.5m for not giving the CMA notice of some change in staff for key members.
The penalities can also be ongoing, repeated, and proportionate to the offence. This record breaking merger by MS could also lead to some record breaking penalties.  

 

MS's dog and pony show is the gift that keeps on giving. 

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23 minutes ago, TJ_Solo said:

 

Well if ignored the CMA would go the pentalty route. The CMA fined Meta £1.5m for not giving the CMA notice of some change in staff for key members.
The penalities can also be ongoing, repeated, and proportionate to the offence. This record breaking merger by MS could also lead to some record breaking penalties.  

 

MS's dog and pony show is the gift that keeps on giving. 


I did notice that one case of penalizing a U.S. company, thanks for that example. I don’t see how that’s much different than the FTCs ability in regards to penalties, so I still don’t have the information that makes the CMA the singular entity that can stop two US companies from merging. 
 

It also looks like Meta ignored the CMA orders on multiple occasions over the years, again making me question their alleged inescapable authority. 
 

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I am not part of the crowd that declares this deal dead based on any of these regulators or claim this deal will pass and can't be stopped. 
Since I am not from the UK or in the EU, the CMA is also new to me. I've never paid any attention to that group or any of their rulings.  

 

The FTC? Sure. I've seen their rulings and decisions in the past.

The EC? They've been around a lot longer than the CMA and I've seen their name in news more often.

 

I am more interested in what those two have to say than the CMA. 

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https://mobile.twitter.com/Wario64/status/1623312010493706240?ref_src=twsrc^tfw|twcamp^tweetembed|twterm^1623312010493706240|twgr^333125fe78bff756b35df5c15506884c291dc356|twcon^s1_&ref_url=https%3A%2F%2Fgamefaqs.gamespot.com%2Fboards%2F264564-xbox-series-x%2F80340176

 

Looks like the odds of a favorable ruling from the UK just plumetted. Microsoft might have to sell off major portions of the company in order for approval and considering they only bought them precisely for those IPs pretty much makes the deal moot

Edited by majob
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12 hours ago, DaivRules said:

Are you able to provide a clear explanation as to why specifically the CMA is singularly able to stop two US companies from merging? I'm not able to find any historical examples, if you know of any, where they have stopped or unwound two US companies from a merger? 

I was looking for precedent for your claims, but I have only found EU companies or UK companies and very, very few examples, some are still tied up in courts. And it looks like companies can ignore the CMA and just pay financial penalties if they choose so I'm looking for clarity on your descriptions of what they can do or have done with specific cases.

 

The CMA can't be overturned like the FTC and many other regulators so they go against the deal then Microsoft cannot change that. There does exist a body you can appeal to (that sides with the CMA 67% of the time), but that body can only force the CMA to cross some Ts and dot some Is in essence as the CMA can (and will) just hand out the same result.

 

Now can Microsoft choose to ignore the CMA's decision? Certainly, however being bound by the regulator is a condition of Microsoft doing business in the UK so Microsoft would have to pull out of everything in the country. This isn't simply not selling CoD or Xbox games as a whole, every other aspect of Microsoft's business would have to be pulled out also. Some Microsoft supporters think that is what Microsoft should do, play hardball and all that, but such a thing would be catastrophic for Microsoft as not only would that mean massive income losses but it would instantly get heat with all of the other regulators. It would not be crazy to say that Microsoft trying to be above the law in such a nature would cause calls for them to be broken up (which happened in the past) would spring up again.

 

As for ignoring and penalties. That is why the CMA does not take behavioural remedies seriously if they're on their own. Companies can and will just eat chump change fines (serious fines can be handed out, such as 20% of income, but that wouldn't be for behavioural stuff). Regardless however that the CMA is known for hating behavioural remedies and them even telling Microsoft as such, Microsoft with their fancy lawyer army is still even now trying to pass the deal with only behavioural remedies. While funny to laugh and say that Microsoft has hired lawyers as competent as their Xbox managers, the reality is more likely that Microsoft simply will not accept these structural remedies and so this is all the lawyers can keep arguing. They'll argue no doubt that these structural remedies are too harsh, but once again Microsoft's own statements will catch up with them. Microsoft in revealed documents state that CoD is no big deal (imagine lying this hard) and publicly they've said numerous times that King and Candy Crush is what they really want. If they are telling the truth on that then they should have no problem acquiring only King and not getting Activision and Blizzard. If Microsoft quits the deal however then we can rule the King is the real prize thing as yet another lie from Microsoft.

 

9 hours ago, TJ_Solo said:

I am not part of the crowd that declares this deal dead based on any of these regulators or claim this deal will pass and can't be stopped. 
Since I am not from the UK or in the EU, the CMA is also new to me. I've never paid any attention to that group or any of their rulings.  

 

The FTC? Sure. I've seen their rulings and decisions in the past.

The EC? They've been around a lot longer than the CMA and I've seen their name in news more often.

 

I am more interested in what those two have to say than the CMA. 

 

The FTC can be easily overcome due to their decisions being able to sent to the courts which are stacked with heavily corrupt pro business judges. The EU can also be taken to court but a bigger point would be they are much more amendable to behavioural remedies. Note how Microsoft have already received the notice from EU and it didn't cause them to start raging as they have with the CMA. 

 

The CMA is an entity that doesn't go for passing deals with only behavioural (they have only in a single special case I believe) and can't be gone above on their decisions. If they go against you then that is it. As a result of this the CMA has been the most important regulator out of all of them for the deal. The FTC by comparison only has importance in how they can give support to other regulators blocking the deal, as the FTC is completely unable to stop this deal by itself. If you haven't heard of or seen the CMA in the news as much it would be because they were formed in 2013 (they combined the duties of two now defunct bodies, the CC and OFT).

 

50 minutes ago, Zephrese said:

The amount of moronic responses to that tweet is vomit inducing, to say the least.

 

As I predicted Microsoft supporters are right back at calling the CMA corrupt incompetent know nothings like back when they published the Phase 1 report. The FTC going against Microsoft caused them to change their tune to "The CMA knows what they are doing, the FTC doesn't" if you missed it. Just shameless behaviour.

 

Its not all doom however as they're reaching at any instance of hope to state that not only isn't the deal dead, but this has only increased the chances of the deal passing. For example, the CMA hasn't said no to behavioural remedies so this must mean that Microsoft can still get by on that... except that the CMA can't say "we'll never accept behavioural remedies" so they have to say that even if everyone knows they won't. There is some analysts out there also doing the same and showing how incompetent they are like the infamous Michael Pachter who thinks the CMA is doing this just to look good and that they know they'll lose in court when you can't win in court against the CMA to overturn their decision.

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16 hours ago, Rozalia1 said:

Gamepass is failing and if it keeps failing then there will come the point where the money men will question why so much is being poured down a money pit, hence why Microsoft are on a buying spree of which this has merely been the biggest piece. Also, you know, you need good management in place which Microsoft is apparently incapable of establishing at Xbox.

How is Game Pass failing?

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1 hour ago, Cryogenicide_X said:

How is Game Pass failing?

It's not exactly "failing" but it's stagnating. Microsoft exaggerated their subscription numbers and it turns out they're not drawing many new ones. Most people simply do the trial then never renew. A major reason Microsoft has gone on a buying spree is to have more IPs they can keep on Gamepass on a permanent basis to encourage subscription growth.

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3 hours ago, Rozalia1 said:

The CMA can't be overturned

 

The CAT can and has overturned the CMA.
 

3 hours ago, Rozalia1 said:

but that body can only force the CMA to cross some Ts and dot some Is in essence

 

That spin is just as bad as Microsoft's spin. Please give cases if you want anyone to believe that claim.
 

3 hours ago, Rozalia1 said:

Now can Microsoft choose to ignore the CMA's decision? Certainly, however being bound by the regulator is a condition of Microsoft doing business in the UK so Microsoft would have to pull out of everything in the country.

 

Another claim I can't seem to find backed up with any evidence online. While convoluted, MS is seemingly able to stop only any of it's business involved in the CMA's case. MS could stop selling XBOX consoles and games, and restrict digital PC game sales based on geography from it's own stores if it chose. I think your claims of massive multi-channel business must completely pull out of the UK if just one of their channels is determined to be in violation of of a CMA decree, are overstated. And I can't find any cases in the just 10 years the CMA has been a thing, where that claim of yours has been demonstrated or tested.
 

3 hours ago, Rozalia1 said:

As for ignoring and penalties. That is why the CMA does not take behavioural remedies seriously if they're on their own.

 

Seems completely contradictory to even offer it as a possibility in their findings if your claim can be backed up.
 

3 hours ago, Rozalia1 said:

Companies can and will just eat chump change fines (serious fines can be handed out, such as 20% of income, but that wouldn't be for behavioural stuff). Regardless however that the CMA is known for hating behavioural remedies and them even telling Microsoft as such, Microsoft with their fancy lawyer army is still even now trying to pass the deal with only behavioural remedies.

 

They "hate" them so much they offer them? Your spin on things, again, hurts the credibility of your claims when you personify things. And of course MS is going to lean toward behavioral remedies, the CMA themselves, in their own document, listed it as an option.
 

3 hours ago, Rozalia1 said:

The FTC can be easily overcome due to their decisions being able to sent to the courts which are stacked with heavily corrupt pro business judges. The EU can also be taken to court but a bigger point would be they are much more amendable to behavioural remedies. Note how Microsoft have already received the notice from EU and it didn't cause them to start raging as they have with the CMA. 

 

While it is possible to challenge the FTC, you dismiss it so quickly with your loaded language, but it's not a guarantee that it will happen as you describe. That's why we have the appeals court and supreme courts. If the FTC establishes a solid case, it's much more unlikely to be overturned by a singular rogue judge. It's true the US doesn't grant some of the regulators authoritarian level power and have a system of checks and balances, and since it relies on humans, there are occasionally some flaws. But things can have gone both ways over time. What happens when someone corrupts the CMA, they have no system to check them so they can run rampant unchecked as you claim? 
 

4 hours ago, Rozalia1 said:

The CMA is an entity that doesn't go for passing deals with only behavioural (they have only in a single special case I believe) and can't be gone above on their decisions.

 

First you contradict yourself, then you make a claim that has already been debunked.
 

4 hours ago, Rozalia1 said:

The FTC by comparison only has importance in how they can give support to other regulators blocking the deal, as the FTC is completely unable to stop this deal by itself.

 

Neither of these two claims are backed by evidence. The FTC Act absolutely gives FTC authority to take actions themselves, not just "support other regulators", and can absolutely stop a deal by itself. Your constant unfounded dismissal of the FTC based on your willful ignorance makes your claims completely untrustworthy. And your spin is just as bad as the comments you're deriding from other people.




 

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https://finance.yahoo.com/news/activision-ceo-kotick-stay-unlikely-194046927.html

 

Quote

The same sources said confidence remains high inside Activision that the U.K.’s Competition and Markets Authority (CMA) – which sources told FOX Business is "the only regulatory body that really matters" in the merger case – will look at the numbers and realize the acquisition will not hurt gamers, despite what the CMA alleged on Wednesday.
 

Sources told FOX Business the reason the CMA is the "only real potential roadblock" among regulatory bodies is that once the U.K. regulator makes a decision, unlike the U.S. Federal Trade Commission, it offers companies no legal recourse such as a trial.

"Microsoft and Activision would win any U.S. litigation merely on the facts," the sources said.

 

If there continues to be doubts here is an article from Yahoo that states what I've been saying. Straight up saying that the CMA is the only regulator that matters because again for the reason I've outlined previously.

 

The bit on the FTC is also what I've been saying. Microsoft certainly would win "on the facts" because America, an infamously pro-corporate state (another way to say corrupt to me), has the rules set in such a way that big companies with massive amounts of money are massively advantaged. In a non Lina Khan ran FTC, Microsoft would argue for and get a market definition counting gaming as a whole (they have for this deal unsuccessfully) which show Microsoft nowhere near the... 40% market share I believe (if not 40 then 30, but pretty sure it is 40) which is the amount where even that corrupt system says no more. Microsoft is about 7% or so which is nowhere near 40% and so in that corrupt system would be free to not just buy Activision, they'd be able to buy up EA, Take 2, Ubisoft, and more also.

 

This sort of thing is why many have always been wary of Microsoft. Don't buy this narrative from supporters that Microsoft is only doing this now to compete and that them not doing it 20 years ago proves that it ain't just an attempt to buy success. 20 years ago Microsoft still had the fear in their hearts of being hammered and even broken up from the whole Windows/Internet Explorer issue so they could only spend so much. That fear has clearly passed and they think they can act with impunity as Microsoft even compared to other companies referred to as "Big Tech" has been spending significantly more money than everyone else in buying out companies across all manner of different tech sectors.

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6 minutes ago, AJ_-_808 said:

About those revenge fantasies... I've started wondering if a result from this would see Microsoft cut server support for Bethesda games still running on Playstation - ESO and Fallout 76 being two of the biggest still being supported

 

Ah, I've heard that one bandied around too. That Microsoft should remove off PSN any game they own the rights to and cut their existing support and online capability. 

 

Nothing is impossible of course but I don't see it myself. Unlike spending massive amounts to get a CoD exclusive there is no gain that can be pointed to with that and Microsoft is also ultimately still ran by a PR guy (if they don't blame him for this failing and fire him). Many critics of Microsoft have called out their good guy act as fake and them acting in that manner would only prove them right, but more importantly than that it would not go down well with the CMA & EU (the situation with the FTC can't get worse) which they don't want if they wish to continue buying up companies.

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