Corporate Crush Saga

December 8, 2022 12:52 PM

The FTC will sue to block the $69bn acquisition of Activision Blizzard by Microsoft. Activision Blizzard CEO says 'the allegation that this deal is anti-competitive doesn't align with the facts.' The FTC says 'Microsoft has already shown that it can and will withhold content from its gaming rivals.' Pitfall Harry could not be reached for comment.
posted by box (27 comments total)

Huzzah! I really hope they can block this deal which is obviously monopolistic since it means a huge set of games likely becoming PC/Xbox exclusive, which means I guess I'll never play them. One console should be enough!
posted by dis_integration at 1:03 PM on December 8, 2022 [3 favorites]

Can the FTC make all the games get ported to the Switch as well? And made playable somehow?
posted by any portmanteau in a storm at 1:20 PM on December 8, 2022 [4 favorites]

Ugh, he’s still CEO? Apparently I have been inhabiting a parallel universe where Kotick was out.
posted by Jon Mitchell at 1:23 PM on December 8, 2022 [3 favorites]

I mean, on the one hand, yeah, monopoly. On the other hand, Activation Blizzard is now such a shitty company, that I can't imagine it could be made worse in the hands of Microsoft. It's like dumping rotting banana peels into the compost pile.

Microsoft seems to be leaning hard into the subscription model of video game content delivery, and their consolidation of publishers is concerning from that standpoint. So hopefully this does get blocked in the end, but I'm just not sure it would make any functional difference that they own 2-3 more AAA properties.
posted by Room 101 at 1:24 PM on December 8, 2022 [2 favorites]

To put this in a bit more context, read FTC Chair Lina Khan’s barnstormer 2017 article about antitrust enforcement in tech. She was a student then, wields a lot of power now due to that piece.
posted by migurski at 1:24 PM on December 8, 2022 [7 favorites]

I think our culture would be best served by Activision/Blizzard being torn to shreds and its various IPs snapped up by whoever gets there first.

I think gamers would be best served by having this merger go through because Activision/Blizzard even outside of its vile culture is a blight on the industry.

But I also think the overall market and people of the US would be best served by blocking this merger on antitrust grounds, so chalk me up as "wouldn't shed a tear if Kotick were dragged off into the woods by a ravenous bear" but ultimately in support of the lawsuit.
posted by tclark at 1:34 PM on December 8, 2022 [7 favorites]

Major market consolidation is always going to fuck consumers, it's just a matter of when, not if. Even if Activision Blizzard is a trash fire right now they still have a ton of valuable properties, consolidating them under a company that's literally known for attempting monopolies in the past is not ideal for anyone.
posted by Ferreous at 1:49 PM on December 8, 2022 [8 favorites]

Can't there just be a business that survives and rolls along merrily forever? Lawn, offa, kids, etc.
posted by rhizome at 1:57 PM on December 8, 2022 [5 favorites]

One of the biggest failures in the US enforcement of antitrust legislation is that it has only looked at what's best "for consumers" in the past 40 years or so.

We've seen that monopolies (and monopsonies) can completely fuck over employees, contractors, and suppliers even if the consumer ends up with a "good deal" and as such, it's still awful for the economy and for competition.
posted by explosion at 1:58 PM on December 8, 2022 [16 favorites]

This is an encouraging sign that Khan’s FTC does, in fact, have teeth.
posted by grubby at 1:59 PM on December 8, 2022 [2 favorites]

On the other hand, Activation Blizzard is now such a shitty company, that I can't imagine it could be made worse in the hands of Microsoft.

Maybe they can't make Activision-Blizzard any worse, but they can make the industry shittier through further concentration.
posted by Dark Messiah at 2:18 PM on December 8, 2022 [6 favorites]

Maybe they can't make Activision-Blizzard any worse, but they can make the industry shittier through further concentration.

... and loot boxes / microtransactions. Once Microsoft gets the sweet loot box revenue stream rolling in, they're going to apply it to everything including Windows.

You want a different background? Loot box. Different icons? Loot box. Fewer blue screens of death? Hey, sorry buddy, we're not magicians here.
posted by ensign_ricky at 2:37 PM on December 8, 2022 [4 favorites]

They moved the Start button to the middle of the taskbar, so we can't rule out anything no matter how upsetting.
posted by Dark Messiah at 2:38 PM on December 8, 2022 [21 favorites]

The thing that confuses me is that Sony and Nintendo thrive on their exclusive titles, but if MS tries to buy their way in then suddenly it's anti-competitive in their eyes?
posted by thecjm at 5:02 PM on December 8, 2022 [3 favorites]

This one doesn't make sense to me and seems an odd battle for the FTC to choose. I really don't see a major risk to consumers here--games have more competition than most industries, with areas of some concern specifically around distribution (Steam, app stores), and there are few enough major consoles that any merger between MS, Sony, or Nintendo would be a problem. But MS and ATVI seems fine to me? I don't get the objection on behalf of workers--as a former ATVI (King) employee, Activision Blizzard has been so poorly run for so long, if I were still there I'd be eager for new leadership. I also don't see it making any sense to buy Activision Blizzard with a plan to pivot it to more platform exclusive titles--the industry has been moving away from that for awhile and ATVI in particular is spread all over the place, irreversibly so, as far as I can tell. Besides, MS has said they weren't planning on doing this for platform exclusives, and while such statements may not be binding, I don't know, maybe there's some way for the FTC to extract some sort of binding agreement to that effect as a sort of happy middle ground. I worked in the game industry for over ten years and, eh, this merger makes a lot of sense to me, meanwhile during that time I mostly had just one option for broadband provider, so if the FTC wants to do something actually useful it doesn't seem like it would be that hard.
posted by kprincehouse at 5:16 PM on December 8, 2022 [5 favorites]

Major market consolidation is always going to fuck consumers, it's just a matter of when, not if.

After a certain point, this is 100% true. It is also true that in the current political climate where at least half of the ruling class is either furiously rolling back or refusing to allow the implementation of tax and policy that encourages investment rather than short term profit taking that consolidation that could otherwise be a net good isn't. Some businesses are too capital intensive to support a large number of competitors, but by the time you're down to five or so it's time to be seriously skeptical about allowing any further consolidation.

I'll be interested to read more at some point about what exactly the FTC is arguing here, but given the environment for the past couple of decades, I'm inclined to give them the benefit of the doubt. They've gotta start somewhere, after all, and just about any merger/acquisition they take issue with will seem silly against the backdrop of bullshit that has been previously allowed. Of course it seems like such small potatoes as to be of questionable utility given the context.
posted by wierdo at 5:32 PM on December 8, 2022 [1 favorite]

The thing that confuses me is that Sony and Nintendo thrive on their exclusive titles, but if MS tries to buy their way in then suddenly it's anti-competitive in their eyes?

This is more than just Xbox consoles, surely? You can subscribe to the Xbox service on Windows.
posted by They sucked his brains out! at 5:51 PM on December 8, 2022

Also "hey other people do it" isn't a great defense of market consolation.
posted by Ferreous at 6:01 PM on December 8, 2022 [4 favorites]

This one doesn't make sense to me and seems an odd battle for the FTC to choose. I really don't see a major risk to consumers here

I think migurski's link is the critical piece of the puzzle here: the FTC is currently run by a chair who spearheads a school of legal thought that the American precedent of antitrust as being mostly about whether consumers are better off is misguided. I think they might see this as a good test case - if they successfully argue that this is overall bad for the market, and in so doing overturn decades of precedent on American antitrust law, it'll give the FTC a huge amount of legal power to go after a wide range of companies.
posted by Merus at 6:07 PM on December 8, 2022 [7 favorites]

I also think "is the consumer better off" is an elided form of "is the consumer better off for the time being"
posted by Ferreous at 6:11 PM on December 8, 2022 [5 favorites]

Meanwhile... "Diablo IV developers allege mismanagement, crunch and disturbing creative decisions in new report"
posted by Pyrogenesis at 11:54 PM on December 8, 2022 [1 favorite]

Starting to think Microsoft's whole schtick is becoming "we bought this brand because its reputation is so bad it's undervalued if we can cleanse the image"
posted by JauntyFedora at 11:57 PM on December 8, 2022

I think migurski's link is the critical piece of the puzzle here: the FTC is currently run by a chair who spearheads a school of legal thought that the American precedent of antitrust as being mostly about whether consumers are better off is misguided.

It's worth remembering that legal precedent was championed by a lawyer who infamously engaged in a spot of light treason by attempting to kill an investigation into the president by firing the people doing the investigating - and then expected to be rewarded for it with a Supreme Court seat.
posted by NoxAeternum at 3:46 AM on December 9, 2022 [1 favorite]

I feel it’s important to remind people that Halo was announced by Steve Jobs at Macworld 1999 before Microsoft bought Bungie and made Halo an XBox exclusive. This is a long pattern of behavior.
posted by Revvy at 1:26 PM on December 10, 2022

The thing that confuses me is that Sony and Nintendo thrive on their exclusive titles, but if MS tries to buy their way in then suddenly it's anti-competitive in their eyes?

Nintendo and Sony develop in house so the FTC cannot review their actions, Microsoft is trying to buy exclusives so it falls into FTC’s purview.
posted by jmauro at 7:10 AM on December 11, 2022

Nintendo and Sony develop in house so the FTC cannot review their actions, Microsoft is trying to buy exclusives so it falls into FTC’s purview.

Sony (Sucker Punch, Naughty Dog, Insomniac, etc.) and Nintendo (HAL, Game Freak, Factor 5, etc.) do have constellations of second party and acquired development studios - however, those were built in a more organic manner than Microsoft just outright buying ABK.
posted by NoxAeternum at 8:06 AM on December 11, 2022

Starting to think Microsoft's whole schtick is becoming "we bought this brand because its reputation is so bad it's undervalued if we can cleanse the image"

There seem to be two dominant strategies of acquisition in big business: "buy a company, gut it of assets, and drive it into the ground;" and "buy a brand that has been driven into the ground and rehabilitate it, if only by name."
posted by rhizome at 1:19 PM on December 12, 2022