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Microsoft / Activision Deal Approval Watch |OT| (MS/ABK close)
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Heisenberg007
Gold Journalism
Activision makes $2B a year in profit. They're doing great from a company POV. Individual suits not getting a premium on the share doesn't really count as they don't get paid because of any exclusivity deal.
Besides, they will get a cash injection of up to $3 billion from Microsoft as a penalty if/when the deal falls through.
Microsoft said the COD exclusivity does not make financial sense. It wouldn't make financial sense if the deal falls through.
James Sawyer Ford
Member
It has me thinking what the actual market share is (excluding mobile)
Sony - 35%
PC - 30%
Nintendo - 25%
Microsoft - 10%
Complete guesses but probably not too far off
Sony - 35%
PC - 30%
Nintendo - 25%
Microsoft - 10%
Complete guesses but probably not too far off
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DeepEnigma
Gold Member
FoxMcChief
Gold Member
I don’t get what you’re saying. This move either way wouldn’t change that. Sony has a majority lead over the competition right now. Xbox isn’t going anywhere.
Is this the new “Nintendo is doomed”?
Nah. Funniest of them all are the ones hypothesizing on how Activision will take revenge on Sony if the deal is blocked. As if Activision would change their entire business model and tank their stock price just to teach their most lucrative partner a stern lesson.
A close second are the people trying to spin the narrative to the deal being necessary to prevent a monopoly.
FoxMcChief
Gold Member
knocksky
Banned
Lol really?? Obviously you don't really have anything to say. So take your time and think about it before replying
Bitmap Frogs
Mr. Community
Heisenberg007
Gold Journalism
As multiple people (including me) have said it before.
(1) Sony is not a monopoly.
(2) Even if it were, no regulator would look into it and try to make Sony small because monopolies are allowed by law. Monopolies through unfair means, however, are not.
DeepEnigma
Gold Member
This is the cringiest and biggest bullshit being spun.
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knocksky
Banned
Perhaps, or more than likely Sony would squash Nintendo down to first party and some Indies.
Loxus
Member
Your the one who isn't thinking.
Raising prices to high would cause a repeat of the PS3.
ToadMan
Member
You haven’t missed anything …
Topher
Gold Member
I believe PC gaming was as almost as large as console gaming last time I looked. Either way, no matter how you slice the gaming industry up, the narrative of a monopoly existing in any of it is just a made up fantasy.
Here you go Q quest
Not as close as I thought, but still that's a hefty chunk of the market in the PC realm.
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Heisenberg007
Gold Journalism
While it is how you say, but the situation is very different this time.
To put it into a summarized perspective: they have spent over $10 billion dollars in the division, and XBS is selling worse than Xbox One.
Nobody saw that coming. Honestly, even I didn't. In all prediction threads around launch, I always said that XBS would sell 60-70 million consoles. Now it's tracking to sell around ~40-45 million consoles. Xbox One sold ~52 million consoles.
They can eat the cost only so much and for so long. They did consider shutting down Xbox around 2016-2017, so it's not completely baseless or without precedence. It's a possibility that's stronger than ever.
Having said that, I still believe that Xbox would first go multiplatform rather than shutting down immediately.
Why would they bother with 3rd party and almost no returns. More likely they shutdown the hardware division and sell the studios to tencent. Make a clean break instead of pissing money away being a 3rd party with zero upside for a company the size of Microsoft.
knocksky
Banned
I'm not talking about the hardware. The entry price would still be reasonable.. it's the rest where the creep would start.
Topher
Gold Member
Hard to say about Xbox sales since we don't have numbers. My guess is Xbox Series is actually outselling Xbox One (when aligned) by quite some margin. Also, Tom is right. The investments made into Xbox are concrete examples of Microsoft's committment to Xbox. Xbox isn't a Zune or Nokia situation. It is a significant source of revenue with profitability. I'm guessing the margins are not what they would like them to be, but I see no reason for the Xbox division to be in doubt.
Loxus
Member
This applies to software as well.
Raising the prices to high would cause the userbase to find other means of gaming.
Heisenberg007
Gold Journalism
Xbox is a big operation; there will be very few buyers. Suppose Tencent is not interested in the deal. That leaves very few buyers on the market who can and would want to buy Xbox.
So it may be difficult to wind up operations just like that.
And I think there's money to be make as a third-party, like EA and Capcom for example, because Xbox has a ton of great IPs now. The problem is their hardware attach rate and low userbase. That's why they started releasing games on PC, but then AAA games have become more expensive, and it may not be viable as before.
If they release their high-profile IPs and games across all platforms: PC, Nintendo, PS, Xbox, etc. they can increase their ROI (which could prevent them from shutting down the Xbox brand completely). They can also make a first-party-only Game Pass tier and put it on Nintendo and PlayStation and can increase their subscribers to 50-60 million, which can also be profitable.
Punished Miku
Human Rights Subscription Service
That's all I tried to say. And it wasn't a new narrative. That was my personal rationale for being in favor of this deal since it was announced. Pretty difficult to even speak in this thread with all the insults being thrown around, so I'm glad you were allowed to make the argument at least.
Heisenberg007
Gold Journalism
After the NPD leak, we have the US data now. We also have the UK data by the 1M and 2M milestones threshold. UK and US cover more than 75% of the Xbox market. We also have Japan's data. So that's like 80% of the total Xbox console sales accounted for.
We also have PS's official data that we can use to easily calculate Xbox's console sales data. A few GAF posters have already done it actually and compared it with Microsoft's submitted documents to regulators.
We can say with a very high confidence level that XBS is now tracking behind XBO.
GHG
Gold Member
The only thing I'm interested in seeing is who here sticks around should this happen.
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gothmog
Gold Member
WTF?
This is literally the FUD we all talk about.
Pelta88
Member
Given what we've seen of the actual numbers, I couldn't get past this particular point, respectfully. XBOX in the Apple case revealed they haven't made a profit. XBOX is attached to a huge an impactful conglomerate. Stripped back to its own business it's nowhere near as valuable as you believe it to be.
Without Microsoft footing the bill for every misadventure, I'm not sure the platform is viable.
I don't want XBOX to disappear and give Sony free reign over the console space. But the reality of XBOX is that it's been in poor shape for a decade. And that's without the 360 RROD debacle.
Topher
Gold Member
I haven't seen this NPD leak. Was it posted on GAF?
knocksky
Banned
Where? PC. Where the barrier to entry is significantly higher. Or Nintendo, who would quickly find themselves squeezed by a Sony gaming behemoth. I.E a very limited library of 3rd party games.
I am struggling to find something good that would come out of Microsoft quitting the console business and giving Sony a monopoly.
Heisenberg007
Gold Journalism
I'm always up for an actual, meaningful conversation if you want. Difference of opinion is okay.
As for the reason for favoring this deal -- I think it's just wrong. What if Xbox's situation doesn't improve after ABK? Like it didn't improve after Zenimax? Should they be allowed to acquire other studios -- like Ubisoft, Rockstar, CDPR, Capcom, etc. -- until they are able to compete head-to-head with PlayStation?
That cannot be the case.
Xbox's problems are not going to be solved by this acquisition. Just like those problems didn't go away with Zenimax. Xbox needs to improve its business model, make great games, focus on proper marketing, localization efforts, etc.
At the moment, they have more studios and IPs than PlayStation. They have all the resources they can possibly to need to compete. They just need to put those efforts in the right direction.
Banjo64
cumsessed
Yeah - and the concession will be divestiture.
ArcaneNLSC
Member
Exactly Microsoft can't keep trying to buy its success by buying out the competition or all the IP it has to create its own success the hard way by fucking working and earning it like a lower class/middle class worker
Banjo64
cumsessed
WTF?
Nintendo about to open that cheque book.
FoxMcChief
Gold Member
I’d be down.
ChorizoPicozo
Member
ArcaneNLSC
Member
It be funny if deal falls through Microsoft do decide to shutdown the Xbox Division in a few years and then Nintendo buy the Xbox Division. A funny full circle moment given MS tried to buy Nintendo
Banjo64
cumsessed
Nintendo playing the long game to re-acquire Rareware.
ArcaneNLSC
Member
Ignore accidentally hit quote when editing my post or something
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ChorizoPicozo
Member
question.
Would the hiring freeze have an effect on studios entering full production?
Would the hiring freeze have an effect on studios entering full production?
Heisenberg007
Gold Journalism
Yes, it was. We also discussed it even in this thread I think. There was a thread IIRC but found this post for you.
US data:
- Xbox Series LTD = 8,763,000
- PS5 LTD = 10,592,000
PS4/Xbox One split in the US was 53:47. PS5/XBS split in the US is now 55:45, so they have already lost 2 percentage points of market share in the US. Considering that PS5 has gained market share from Xbox despite selling less than PS4 guarantees that XBS has sold less than Xbox One in the US.
Sony's CFO has also shared similar statements that validate this data.
PS5's Market Share Is Expanding Significantly in Xbox's Backyard
Sony takes control in USA
www.pushsquare.com
Xbox Series X has also not sold 2 million units in the UK yet even after 116 weeks. Xbox One reached 2 million units in the UK in 104 weeks. So XBS has also sold less than Xbox One in the UK.
We also did a bunch of other calculations and estimates and found Xbox Series consoles around 16-17 million consoles sold LTD (18 million if we're being lenient). Microsoft also hasn't released any statement that "Xbox Series is still the best selling Xbox console" in their earning reports, further validating this.
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Heisenberg007
Gold Journalism
Topher
Gold Member
Wouldn't be the first time. I believe when the Disney Fox deal went through, the CMA required Disney to divest several assets.
Yes, it was. We also discussed it even in this thread I think. There was a thread IIRC but found this post for you.
US data:
- Xbox Series LTD = 8,763,000
- PS5 LTD = 10,592,000
PS4/Xbox One split in the US was 53:47. PS5/XBS split in the US is now 55:45, so they have already lost 2 percentage points of market share in the US. Considering that PS5 has gained market share from Xbox despite selling less than PS4 guarantees that XBS has sold less than Xbox One in the US.
Sony's CFO has also shared similar statements that validate this data.
PS5's Market Share Is Expanding Significantly in Xbox's Backyard
Sony takes control in USA
Xbox Series X has also not sold 2 million units in the UK yet even after 116 weeks. Xbox One reached 2 million units in the UK in 104 weeks. So XBS has also sold less than Xbox One in the UK.
We also did a bunch of other calculations and estimates and found Xbox Series consoles around 17 million consoles sold LTD (18 million at best). Microsoft also hasn't released any statement that "Xbox Series is still the best selling Xbox console" in their earning reports, further validating this.
Obviously I missed all that. Thanks for digging up the link
DenchDeckard
Moderated wildly
I thought there were some posts saying Ms May sell of xbox or leave the industry.
Ignore me I'm obviously high lol
ArcaneNLSC
Member
MasterCornholio
Member
Contradicts what Microsoft said but if they are desperate enough they will separate COD from ABK.
Topher
Gold Member
Punished Miku
Human Rights Subscription Service
I personally wouldn't support other large MS acquisitions, but that's just my opinion on it. I think they needed that 1 killer third party game on Gamepass. When 360 was thriving, they had the Call of Duty marketing rights as well. I do think they see Call of Duty as being somewhat fitting with their brand identity the one time they had some success. What I assumed was going to happen was Call of Duty staying multiplat like they said. Xbox would have marketing rights, and could say every year at E3 it's on Gamepass. That alone would be enough in my opinion to give them a fighting chance even if the game remains available for PS, which I think it would.
From my perspective, I have purchased 2 Activision/Blizz games in like 20 years so I feel their impact is really not that big of a deal (Diablo III and Wolverine Origins). It's a bit more games from Blizz on Gamepass, maybe some renewed strategy games on PC since MS supports that, and everyone still has Call of Duty. Seemed fine to me.
The reason I didn't feel it was that out of bounds for MS in this one instance is because from my point of view they're doing many things that encapsulate "fair" competition, and it's just not moving the needle at all. Cheaper console, cheaper games in many cases, new sub service with a cheap price, investing heavily in first party development. Lowering the price is the traditional way to compete. MS was literally cutting series S prices while Sony raised PS5 prices and you just saw the PS market share increase. At this moment in the present, that was really all I needed to see.
Further acquisitions I would view in a similar way by taking stock of the current strength and health of the companies involved and trying to see how it would impact evening things out. That's really all anyone can do. If it's not a giant impact, then it'll probably be fine.
FoxMcChief
Gold Member
I think MS’s next target should be From Software. Just for the forum meltdowns. I think forums would be angrier about that than Activision.
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ArcaneNLSC
Member
Then my job here is doneAw man. WheneverDenchDeckard posts, I’m going to see that guy’s face from now on
MasterCornholio
Member
Don't you mean Kadokawa?
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