EA has to be company A (which desired the merger). The CEO of company A wanted to meet with Bobby in person a week after their call. Since COVID makes travel difficult, its likely the company is in California like ABK (which EA is).
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I wonder if one of the companies is potentially Sony (probably the one that wanted to continue making deals).
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They arenât just competing against foreign companies even within mainstream gaming. OR even within the games-as-subscription service sector either. The FTC wonât put their thumb on the scales to unduly empower an American company knowing full well other American companies could see their ability to compete hindered. The nationality aspect wonât play much of a role here at all imho. With CoD et al not being exclusive it wonât need to anyhow. Theyâve filed their first tranche of paperwork with the FTC already and are presumably looking really good from the pov of the deal going through.
The problem is that the deal is extremely complex. The deal covers dimension of console market (where it competes with Sony and Nintendo), game publishing market (where the juggernauts are Tencet and Sony and smaller beasts like T2 and EA), mobile markets (which is completely bonkers under the total control of Apple and Google and Microsoft had close to none presence while there Genshin Impact, PUBG Mobile and so on), PC market (which is also crazy with those tons of launchers, Epic, Valve and so on), e-sports area (with MLG and other stuff). Then we can throw in metaversesâŚA lot of dimensions. Bethesda deal was essentially like a studio acquisition in comparison.
FTC wonât limit Microsoft there because this deal does not affect american market at much. In fact, FTC has issues with much more egregious Facebook and Apple and Google and Amazon. And gaming is much more splintered.
And COD their so miniscule that by keeping Warzone 2 (and not removing the games from the shop) on Playstation they already did enough and fullfilled the obligations. Add to that their releases on Steam (probably ATVI games will come to Steam or they will use Battle Net who knows) and it is already good.
Yeah, I think so! That would make it Company E. Bobby spoke with the CEO but it was a âsenior executiveâ who delivered the verdict and was the point man for the deal. Jim Ryan? Considering they didnât have the financial capability but still had interest in other potential transactions (partial acquisition or IP purchases) itâs likely a gaming company. And Tencent is rich as hell⌠So our best guesses now are:
- Company A: EA
- Individual B: Micheal Morihame-led private investors
- Company C: Wealthy tech company (facebook goes here?)
- Company D: Wealthy tech company (facebook goes here?)
- Company E: Sony (maybeâŚ)
Its fun to speculate and see the behind-the-scenes on this stuff.
Also what company wanted to buy a mobile division? I remember @BRiT mentioned it.
Yeah, it is interesting to read the timeline - so many meetings everyday 
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Wat. The deal has massive consequences across the American gaming landscape. CoD is not âminisculeâ by any stretch. It is a critical element of the entire acquisition both from the regulatory pov and both MS/ABKâs pov.
Where are you getting that Company A wanted a merger?
You are overestimating COD too much. Considering that COD is on PC the only thing it affects essentially is Sony. But Sonyâs revenue does not rely on COD to a point where suddenly Sony cannot compete without COD. And Warzone 2 stays on Playstation anyway (and we know from ATVI reports that they got more than 50% from MTX or something). Add to that as a competition, Sony exists only in console market (so it is also a part of miniscule market). In addition to that nobody prevents from the competitors to appear - like we saw with Apex and Fortnite.
So in the end FTC cannot limit Microsoft there because
- Sony essentially is a foreign company that competes with Microsoft in a single small market, where Microsoft is trading blows but was decimated the last gen
- Sony does not rely on COD to survive (it amounts to 1% of all Sonyâs revenue at best)
- Sony will still get to have COD games due to contractual obligations (and Microsoft wonât remove them from the store, thus keep them available)
- MTX generate a lot of money and Warzone 2 stays on the platform (so the biggest money maker COD, Sony wonât lose anyway)
- COD going to Microsoft, does not affect mobile or PC markets (as it stays on PC and mobile market is a separate)
- any time some new juggernaut IP might appear like Apex and Fortnite or PUBG
- ATVI is not great shape due to lawsuits and other issues, COD factory and so on
- as soon as the whole gaming market is involved, COD is becoming irrelevant (wonât surprising if Candy Crush or Clash of Kings generate more money)
- practice of permanent and time exclusivity of the big franchises is not new (especially if Microsoft can make COD time exclusive now, nobody can force Microsoft from not doing that and Microsoft can make it 5-10 year exclusive making it irrelevant)
- COD will decline in revenue anyway due to moving to semi-annual releases too
FTC can delay (I donât expect that) and go to the court, but judge wonât buy into due to previous points (and I think there are more points can be added like time exclusivity and permanent exclusivity). So basically FTC can only go to the court due to political reasons but it would be so impossive to prove that Microsoft is doing something bad, that I am sure that FTC wonât bother (especially if media pivots it to FTC delaying the deal while the workers are suffering or something). Especially when they have trouble with Facebook and Apple right now. And that is all without Google and Apple stores debacles. And I did not mention Tencent (who owns 40% of Epic too).
Basically there are so many vectors to defend - and Microsoft is acting as good guy there telling that they wonât remove the released content from Sonyâs store. It is basically impossible for FTC create a trouble there.
I understand that you operate under the assumption that only the worst case scenarios (whether they are realistic or not) can happen, but I donât buy it, sorry.
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It was in the document no? https://www.sec.gov/Archives/edgar/data/718877/000110465922025210/tm225196-3_prem14a.htm
Page 31-33. Company A thought of the idea to create a combined company. Very interesting document.
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The premise that the FTC has no power to do anything is comical. Nobody who understands the topic with any depth would agree with you here. Thereâs a reason folks like Hoeg arenât willing to proclaim the deal is a sure thing with certainty of going through. Trust the intuitions of folks like Hoeg. He knows what he is talking about.
Also, I need not take your guess as to whether the FTC considers CoD important to the dealâŚMicrosoft literally told us that they already know the FTC cares specifically about CoDâs availability. It just isnât open for debate. Trust what Brad Smith (arguably the most well informed human being on Earth in this very specific area given his personal history at MS) says. He isnât guessing about what the FTC wants to question him about. He knows because they have already been in talks with the FTC on the matter for weeks now. They have already filed the first set of documents with the FTC.
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Strategic combination doesnât necessarily refer to merger. MS also referred to their acquisition bid as a strategic combination.
Strategic combination sounds like a mistranslation of arranged marriage
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Hereâs the ABK Board on why a strategic combination between ABK and Company A would be problematic.
âWith respect to Company A, the Activision Blizzard Board of Directors discussed, among other things, that a transaction with Company A would necessarily include a very significant stock component, which would not be directly comparable to an all-cash transaction, would not likely yield significant cost synergies and would need to be premised on the belief that the long-term value of the combined company would achieve greater value than Activision Blizzardâs stand-alone plan. The Activision Blizzard Board of Directors also discussed the relative size and trading multiples of Activision Blizzard and Company A and the implications for how a combined company might trade.â
Read between the lines and youâll realize company A is looking for a merger.
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Hoegâs job is to think of the worst case scenarios and even he thinks that Microsoft wonât have the problem with the deal (regardless if there is pushback or not). And the âpremiseâ is not comical considering that FTC had trouble with Facebook, where the complexity of the problem did not even have the same amount of dimensions as ATVI deal.
No, the thing about COD and âother popular franchisesâ was the potential media backlash that FTC could leverage there. FTC canât do that now. I fully expect COD mainline becoming exclusive (unless Microsoft strike a beneficial deal with Sony if Sony really needs mainline COD, but again Sony got Bungie so they already have some popular GaaS game on their platform anyway + all those third party deals they made). In fact that ATVI deal had only two paragraphs and was tied to their open app store policy mainly.
I donât want to engage into these debates because we both know that we do not agree with each other and you push the worst case scenarios as facts. I do post responses from time to time depending on the mood though.
I suppose the last line is most helpful to your conclusion there, since it suggests ABK combining with them would have a notable effect on stock values, which isnât really the case for MS since they are so big already.
Instead of debating, we should just refer to what Brad Smith himself actually said. 
You are also misrepresenting Hoeg here. He isnât âon the jobâ, he is offering his honest take from the pov of someone who knows how this works far better than the rest of us do. We should respect that expertise and be honest about it. Btw, I have found literally zero ppl on all of the internet who think this deal isnât nearly certain to go through. The fact Hoeg thinks it will go through is not a barometer to discern if he agrees with your premise about the FTC or not. He doesnât. He has said so. Many times, in fact. He says in his opinion itâs 80:20 because there could be regulatory hurdles, and notes that shareholders clearly agree given the present stock price is still well under what MS is offering, indicating they also are not willing to bet too highly on it just yet.
One can hold both ideas in their head at once ya knowâŚagreeing that it will almost certainly go thru but also recognizing the nuanced complexities that could cause roadblocks along the way or slow things down or present potential for issue.
And what he said is exactly what I am talking about - not to mention the fact that he did not provide the straight answer (he literally could not, especially when the deal is not closed) but started to talk about high matters like communities, availability (did he mention joy of gaming), tells you everything you need to know.
Microsoft did not make a commitment regarding âfuture releasesâ, they only committed to keep the games available even after the contracts expire. And what is it? It is when you donât remove the existing games from the store. They even deliberately mentioned that they will offer Sony a deal - but the point of the deal is to get the benefits and Microsoft is very aware how important the exclusives are.
As I stated before - I stick to opinion that mainline COD will become exclusive, but until 2024-2025 we wonât know much anyway.
Yeah. The ârelative sizeâ and âhow a combined company might tradeâ suggest the companies are relatively equal in size if it would affect the future stock price of the combined companies.
I can see why EA would want a merger â the risk side would be on ABK considering how low their stock fell. And ABK+EA would be a massive player if combined. It would completely upend the gaming market and give both companies permanence amid the ongoing content/IP war.
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We also literally know that EA was also in the talks no? So it is just looking at what Company A did, we kinda could connect the dots.
The problem is not the recognition of complexity, but your strange attachment towards the idea that FTC will 100% force Microsoft do have a consent decree (or whatever you called it) base on the fact that Microsoft wonât remove the games from the store (they literally used the same language for Bethesda deal in the documents).
Anywany, I stick to my opinion based on the points I have provided and all the messages that Microsoft left. Roundtable might shet some light though, but until 2024 we wonât know much (how it was with Starfield where they literally put a big message with Xbox Exclusive but there were still questions after the roundtable)