By: Daniel Charles
The video game industry is abuzz over Microsoft’s plans to purchase Activision-Blizz and it is unclear how the acquisition will affect distribution of the most popular game franchise of all time, Call of Duty. Fortunately, it’s likely that if the deal goes through, Nintendo’s Switch console will be able to carry the blockbuster game. It’s also worth noting that the acquisition may cause the deal to be put on hold by the antitrust regulators, who are expected to impose conditions on the deal.
By: Daniel Charles
Sony’s revenue and users could be affected by the acquisition
A recent statement from Sony suggests that the Microsoft acquisition of Activision Blizzard could be detrimental to the company’s revenues and user base. The company wrote a letter to the UK’s Competition and Markets Authority (CMA) citing the potential negative effects of the deal.
Sony warned that losing access to Call of Duty would negatively impact its user base. If Microsoft were to pull Call of Duty from the PlayStation consoles, it would also hurt the company’s ability to form third-party partnerships, such as with Netflix, and could impact its ability to invest in new games.
Currently, Sony is the second-largest gaming publisher behind Microsoft. However, the Sony Group’s shares on the Tokyo Stock Exchange plunged 12.8% on Wednesday after news of Microsoft’s acquisition of Activision Blizzard broke.
Microsoft is currently the third-largest gaming company by revenue. In the first six months of 2019, the firm earned $8.5 billion in gaming revenue. Its share of the global market was 6.5%, compared with 12% for Activision and 14% for Google.
Microsoft’s strategy of acquiring studios, putting more games on its subscription platform, and supporting game streaming is undermining Sony’s
One of the largest purchases ever made in the gaming industry will be completed by Microsoft this year. It will be the company’s first purchase of an entire studio, and is the latest in a series of major deals.
The purchase will help Microsoft build a library of well-known franchises. Moreover, it will help the company better compete with Chinese tech giant Tencent. In addition to a huge mobile games business, Tencent recently made a series of major acquisitions of video game developers.
Microsoft has also gotten into the streaming game business with the launch of Game Pass, a subscription service that allows players to access a curated selection of games. It hasn’t ruled out the idea of walling off titles, though.
Considering the company’s success with the Minecraft game, it’s easy to see why it would want to jump on the bandwagon. With the addition of several major video game studios, Microsoft hopes to become more of a multi-platform games maker.
Antitrust regulators may impose conditions on the deal
The Federal Trade Commission (FTC) recently filed a lawsuit against Microsoft’s planned $69 billion acquisition of Activision-Blizzard. Aside from the FTC’s antitrust investigation into the deal, regulators in the UK have been scrutinizing the acquisition.
According to the FTC, the Activision Blizzard deal could suppress competition in the video game console market. It would also allow Microsoft to increase prices on its own titles and degrade games on competing hardware.
The FTC also claimed the deal would “significantly reduce” competition in the market for cloud-based gaming services, namely Xbox Game Pass. This service offers users hundreds of games on their smartphones and tablets. However, Google has also argued that the quality of Game Pass content is degraded when accessed using its Chrome browser.
While the FTC is unlikely to block Microsoft’s proposed acquisition of Activision Blizzard, it may impose conditions that would preserve the free market. For example, the FTC may require that Microsoft make Call of Duty available on a variety of platforms.
Microsoft has reached an agreement with Nintendo to carry Call of Duty on the Japanese video game company’s Switch consoles
Microsoft and Nintendo have announced a 10-year agreement to carry the Call of Duty series on their Nintendo Switch and Wii U consoles. The agreement comes after both companies had expressed their interest in bringing the hit game franchise to new devices. It marks a major step in the long-running battle between Microsoft and Nintendo.
The deal is contingent on Microsoft’s acquisition of Activision Blizzard, which was announced in January. The purchase is expected to close sometime in Microsoft’s fiscal year ending June 30, 2023.
In addition to the Nintendo deal, Microsoft has extended a distribution contract with Valve to carry the “Call of Duty” series on its PC digital distribution platform, Steam. Spencer has also said that Microsoft is committed to keeping the franchise on its gaming platforms for at least another decade.
Previously, several Call of Duty entries have been ported to Nintendo’s Wii and Wii U consoles. However, the modern iterations of the game are not available on Nintendo’s latest systems.
