CMA Says Microsoft Would Lose ‘Substantial’ Money By Making Call of Duty Exclusive in ‘All Plausible Scenarios’
Among the many findings of the more than 400-page report released by the UK Competition and Markets Authority to block Microsoft’s acquisition of Activision Blizzard, the agency raised concerns raised by Sony over its Call of Duty exclusivity. concludes that it is incorrect. In fact, UK regulators have determined that Xbox would suffer a “significant” loss if it tried to take Call of Duty entirely for itself.
While exact figures have been redacted to protect the privacy of the third parties involved (Sony, Xbox, Activision Blizzard), the report does not address two theoretical reasons why Microsoft would attempt to remove Call of Duty from the PlayStation platform. After concretely modeling the scenario, he concludes: “It would not be economically profitable [Microsoft] Engage in a complete foreclosure strategy. “
Conclusions are drawn specifically from the “critical diversion ratio”. That’s the percentage of Call of Duty players on PlayStation that need to switch to Xbox to benefit Microsoft, and how many new ones? of Duty may be spent. By analyzing the lifetime total value (LTV) of Call of Duty players, the CMA estimates that Microsoft will lose billions of dollars in net losses over the next five years.
Various factors are considered in the analysis of CMA. From the potential reputational damage if Microsoft returns to its official statement on Call of Duty exclusivity, to the benefits of Microsoft’s Game Pass subscription, to Microsoft’s history of sustaining certain hugely popular franchises. , various factors are taken into account. Multi-platform (such as Minecraft), etc. Ultimately, it told the CMA that a scenario in which Microsoft pursues a monopoly strategy on Call of Duty would result in short-term and long-term losses that would not encourage such a move.
Sony has previously claimed that “the loss of Call of Duty cannot be prevented” and that Microsoft’s decision to make Call of Duty exclusive or downgrade its performance on the platform would be irreparable to the company. He said it would cause irreparable damage. Meanwhile, Microsoft continues to assure regulators that Call of Duty will ship to PlayStation consoles for as long as it exists.
Despite the CMA’s conclusion on Call of Duty, they ultimately decided to block the merger over issues that had little to do with cloud gaming. They worry that Microsoft’s cloud infrastructure and subscription services could create monopolies that Sony and Nintendo can’t compete with. and.
From the CMA’s final report, regulators don’t think Nintendo’s platform will be able to run Call of Duty, and how much major publishers say it costs to make their own games, and more. For a deeper dive into what’s going on across the deal, read on for an explanation of what happens next and why cloud gaming, not Call of Duty, is killing the acquisition. Please check.
Travis Northup is a writer for IGN. You can follow him on Twitter @TieGuyTravis and his Click here for game distribution.
