At $68.7 billion, the deal would be the largest video gaming acquisition of all time, however, it has faced criticism from competitors such as Sony and Google, and come under scrutiny from regulators worldwide.
The press briefing began with some positive news for the deal. Despite its initial criticism of the acquisition, Nvidia has entered into an agreement which will bring Xbox games to its cloud streaming service GeForce Now. This deal will include Activision Blizzard titles, including the Call of Duty franchise as Microsoft continues to signal its openness to maintaining the game’s availability across platforms, including entering a deal to bring the franchise to Nintendo yesterday.
Mobile is king, but console is still important
Microsoft also announced that it’s open to a deal with “guard rails” to appease regulators. However, Microsoft president Brad Smith nixed one solution proposed by the CMA, namely cutting Call of Duty, or else whole parts of Activision Blizzard, out of the deal. The CMA stated “The evidence suggests that, after the merger, Microsoft would find it commercially beneficial to make CoD exclusive to Xbox or available on Xbox on materially better terms than on PlayStation.”
"We don't think it's realistic that one part of this company can be carved out from the rest," said Smith, discussing this possibility.
Microsoft has repeatedly asserted that the prime motivator for the acquisition is Activision Blizzard’s strength on mobile platforms, however it appears that console still remains important to the company’s overall goal, as evidenced by its refusal to consider the CMA’s proposition.
In an effort to once again appease regulators that the deal wouldn’t affect competition, Smith reiterated once again that Sony maintains its dominance in the console space. "Think about the market in Europe," said Smith. "It is a market where Sony has an 80% share. Globally, it is about 70/30. In Japan, it is 96/4. These numbers have been remarkably steady for two decades. Even last year, when there were issues with Sony's supply chain, they came back strong."
We listed Activision Blizzard as one of the top 50 mobile game makers of 2022.