Brazil’s competition watchdog, the Council for Economic and Defense Administration (CADE), has approved an unrestricted merger between Microsoft and Activision Blizzard, relying on PlayStation’s already dominant position in the video game industry and franchises such as Call of Duty. It cites Nintendo’s ability to compete without having to.
and long published application, CADE touched on PlayStation’s portfolio of exclusive content, stating: Exclusive content was one of the main factors that positioned PlayStation as the leader in the global console market for over two decades, a leadership that continues to this day. “
CADE also notes that Nintendo employs a similar strategy with exclusive content, but Microsoft doesn’t seem to sell as many consoles as PlayStation or Nintendo. One of the biggest concerns is Call of Duty’s multi-platform status.
“As we have already seen, Nintendo currently does not rely on Activision Blizzard content to compete in the marketplace,” explains CADE. “Sony has over 20 years of world-leading brand strength, extensive experience in the field, the largest user base, the largest install base of any console, a robust catalog of exclusive games and partnerships with multiple publishers. It has several attributes, such as, which should help PlayStation remain competitive in possible post-production scenarios, even in the face of potential loss of access to Activision Blizzard content.”
Watchdog says it’s certainly possible that many PlayStation players will move to Xbox or PC to continue accessing the franchise if Call of Duty becomes exclusive to Microsoft’s ecosystem. .
Call of Duty will lose players and revenue in the short term with this strategy, and many will always prefer multi-platform shooters like Rainbow Six or Battlefield. Even EA CEO Andrew Wilson said a few weeks ago that Call of Duty could be his Microsoft exclusive.
However, this approach will ultimately lead to more Xbox console sales and Game Pass subscribers, giving Microsoft a significant competitive edge in the video game market.
Ultimately, CADE concluded that its purpose was to protect Brazilian consumers and not PlayStation’s interests. CADE said: Such a possibility, in itself, represents a risk to competition across the console market. “
While this is an early hurdle for Microsoft, the acquisition will face scrutiny from the UK government, various US Senators, New York City and the US Department of Justice. Activision Blizzard shareholders approved the deal in April, but there is still much debate about its merits and potential problems.
George Yang is a freelance writer for IGN. You can follow him on Twitter @yinyangfooey.
