The CMA is just showing face and putting up a shallow fight they know will not hold up. UK government definitely does not have resources right now to waste in a court battle with Microsoft, especially over one video game. The deal will pass 100% around the world. There are more important things happening in the world with global recession and threats of increased war in Europe.
Here is the issues statement by CMA. IMPORTANT: Note that MS opted not to bother responding much to the issues statement because they knew any concessions being made after phase 1 would not help them avoid phase 2 scrutiny, so there was no reason for MS to bother with the concessions (called UILâs, undertakings in lieu) yet.
This part here is maybe helpful for discussion here:
"In assessing a foreclosure theory of harm, the CMAâs approach is to consider whether three cumulative conditions are satisfied:
(a) Ability: Would the merged entity have the ability to use its control of inputs (input foreclosure) or to restrict rivalsâ access to a customer (customer foreclosure) to harm the competitiveness or incentive to compete of its rivals?
(b) Incentive: Would it have the incentive actually to do so, ie would it be profitable?
(c) Effect: Would the foreclosure of these rivals substantially lessen overall competition"
I think MS can sidestep (a) real easily with a UIL, making the other two moot, but the details of such an agreement would be real sticky for MS. I still think theyâd agree regardless. MS likely has a weaker argument on item (b) as it sounds like they ignored relevant elements in their financial arguments for incentives. Item (c) to me seems like it could go either way, but again, with a UIL for item (a) the other issues donât really matter.
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Honestly, that wouldnât be a bad concession because in practice theyâd only expect that Microsoft enter such a negotiation in good faith - i.e. theyâd be able to demand a reasonable price but couldnât dismiss the attempt entirely or make unreasonable demands to stop the deal from happening. Call of Duty is still prohibitively huge and itâd cost hundreds of millions to put it on PS+, nothing would ever come from it. And on the off chance Sony ACTUALLY went through with it theyâd just be throwing stupid amounts of money at Microsoft to still come second to game pass which would have every Call of Duty backwards and forwards day one. Works for me.
What? Launching COD in PS+ Day 1 is not a bad concession? What?
This is a good point
The costs of Sony trying to secure CoD Day 1 for PS+ or whatever would be so expensive that theyâd almost certainly never be willing to pay for it while MS still get to look good with the regulators
and by the time they might be willing to afford an older CoD, everyone would already be playing the new ones along with all the others on GP
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Iâm not saying they give it to PS+ day one, IF such a concession were to occur it would only be a requirement that Microsoft give Sony the ability to put it on PS+ at a reasonable price. A reasonable price for one of the biggest gaming franchises on earth being day one on their service is still prohibitively expensive and so would never happen. Itâs an easy win as far as concessions go, nothing would come from it.
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That would be guaranteed sales up-front along with performance bonuses for every additional subscriber. Microsoft wouldnât negotiate a loss-leader deal with Sony. The downside is growing PS+ service.
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I meanâŚhe explains it in that very reply you responded to.
His argument is that Sony would have to pay a ton to MS to make it happen even at fair market value for these kinda Game Pass-like deals. If Sony can do it, they pay MS a bunch and at some level that cost is bigger than the cut PSX ecosystem gets from each $70 sale of CoD as is. That said, it does also help Sony grow PS+ and avoid some of the fallout of CoD hitting GP day 1, so if that was worth it to Sony depends on how the math works out. If Sony doesnât want to pay that much for CoD on PS+, then it doesnât matter anyhow.
Also worth noting that if the deal hypothetically failed, MS might just go ahead and throw that kinda cash at ABK anyhow to launch CoD day 1 on GP and thereâd be scant oversight options for that, so Sony would be in a tough competitive spot there anyhow if that happened.
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Keep in mind any concessions made with the CMA will likely come after the FTC approves and possibly the EU. Therefore the only region concessions would apply to are the UK, which is much smaller concern than thinking about concessions everywhere.
That is a very exaggerated claim
No one here is arguing that. That is a ridiculous demand that obviously wonât happen.
Definitely a fair downside of that scenario. It certainly would help grow PS+ IF Sony were willing to pay that much and continue to do so yearly, ultimately I think Microsoft would still have a competitive advantage on Call of Duty specifically with having the entire back catalogue of games as well as game pass perks and whatever else but most of the interest would be for the new games day one.
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think if MS has to sign something to make sure these games are multiplat indefinitely thatâll happen.
if they have to sign something where they have to be open to putting the games on competing subscription services, then that makes this whole thing pointless
That would be insane because no subscription services puts their content on competing platforms
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They wonât itâs grandstanding.
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I do think itâs relevant for Microsoft to show other subscription service markets as precedent. The CMA doesnât seem to consider how tv/ Movie streaming service for example work the same way.
Maybe they can have Netflix provide some insight.
Microsoftâs answer to the whole, putting their games on competing subscriptions thing, would probably tie back to their willingness to put gamepass on everything, as theyâve mentioned in the past.
if teh CMA finds that a compelling argument or not, who knows, personally I find this whole thing absolutely nonsensical, and itâs painfully clear at this point that Sony has put all itâs eggs in one basket with regards to swaying the CMA, in hopes of getting major concessions.
I think what was missed in my âargumentsâ last week - which was simply meant to get both sides to chill - is that there are absolutely benefits to Microsoft in each scenario of exclusivity. Arguing definitively that there arenât inherent benefits for either side of that coin is bad-faith and the source of many of the issues this thread has had (again, itâs the definitive attitude from people here who canât possibly know which way the wind will blow that Iâm referring to).
Iâve said that benefits for either scenario exist since the day this was announced, and itâs for that reason that if a concession were needed to be made in the UK for some sort of CoD presence, I donât think thereâs a reality where Microsoft says no and puts the deal in jeopardy.
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The precedent for subscription services sharing exclusive content is putting their apps on each others devices. Which Microsoft has offered.
MS offered to put GP on PSX, but not to put their games on PS+ in general. Two very different things. I do think this issue the CMA raised is questionable wrt whomever did the research, to put it mildly.
âThe CMA notes that none of Microsoftâs first-party titles are available on multi-game subscription services other than XGP, even where those titles are available for purchase on rival consoles.â
Deathloop is presently available on PS+ as we all are surely aware. Unless I am misreading Sonyâs official list of games on the service, so is Doom, ESO, F76, and Wolfenstein TNO. I would also add that Minecraft is bigger than CoD and is on GP but not PS+, yet that hasnât led to some catastrophic loss to competition in the sub service sector of the industry. Hell, without GP doing so well Sony would not even be bothering to compete in that space in the first place.
EDIT: Fallout 4 as well.
EDIT 2: And Prey.
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Theyâre better off waiting then. FTC and EU coming out on Microsoft side would only strengthen their position.
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