Competition crush?
Microsoft’s chances of completing its ~$69bn deal to acquire Activision Blizzard look increasingly like a coin flip, as US regulators seek to block the deal due to concerns over competition.
As the company behind video game mega-franchises like Call of Duty, World of Warcraft and Overwatch, as well as simple-but-addictive games like Candy Crush, Activision is a prized jewel in the world of gaming. In the last decade they've grown significantly, but not just through selling more games — a majority of Activision's revenue comes from in-game micro-transactions, subscriptions and other sales.
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Though known by some mainly for Word, Excel and Teams, Microsoft is already a major player in the gaming world through Xbox. Acquiring Activision would give the software giant a pool of mega-hits to anchor its entire future gaming strategy around.
That strategy is likely to revolve around the Xbox Game Pass, a subscription that allows users to play hundreds of games for just one monthly fee. As cloud gaming — where you essentially “stream” the game to your device without needing expensive hardware — matures and expands, Microsoft is betting that game makers, not device developers, will be kings.
And that is, predominantly, what regulators are worried about — if the deal goes through, Microsoft may limit access to Activision Blizzard games exclusively to Game Pass subscribers or players in the Xbox / Microsoft ecosystem.
