Brazil's Economic Defense Administrative Council (CADE) today approved Microsoft's $ 68.7 billion takeover of Activision-Blizzard . Brazil is the second global regulator to approve the deal . Saudi Arabia's General Competition Authority issued a no-objection certificate at the end of August.
The soap opera continues
After setting up a web page explaining the benefits that the acquisition of Activision Blizzard would bring to players as well as to the competition, things continue to move forward positively for Microsoft.
Indeed, CADE indicates that the regulator "approves the merger without restrictions". The move follows weeks of testimonials, data research and direct objections from Sony's legal counsel.
The Brazilian committee recognizes the possibility that Microsoft's ownership of Activision Blizzard could negatively impact PlayStation's business, particularly if Microsoft decides to make major series like Call of Duty exclusive to Xbox,
“Given the enormous popularity of Call of Duty , it is reasonable to infer that if Activision Blizzard games were no longer available on Sony consoles, PlayStation users might decide to migrate to Xbox, or even a PC, to continue to have access to the games of the franchise", can we read in part of the summary of the CADE, according to the site videogameschronicle.
The organization, however, advances several arguments which affirm that, in their eyes, this reason is not sufficient to prevent Microsoft's operation from succeeding.
Sony's arguments deemed inadmissible
"On the other hand, it's also reasonable to think that if future Call of Duty games become exclusive to the Microsoft ecosystem, players loyal to the PlayStation brand might simply drop out of the series, migrating their demand to more. other games available on their favorite console."
"Despite this, the possibility cannot be excluded that Microsoft may find it potentially profitable to adopt an exclusivity strategy on Activision Blizzard games , even if a decision to do so could result in the sacrifice of a relevant part of sales. , users, and even the popularity of Call of Duty.... In theory, such a strategy could help boost Xbox sales, expand Game Pass's subscriber base, and strengthen network effects. on Microsoft's ecosystem , to compensate for any loss of revenue from game sales in the short term." can we also read.
CADE believes that exclusive content has been "very important" to competition in the console market, and one of the main factors responsible for PlayStation and Nintendo's positions as market leaders.
"Exclusive games are a benchmark for competition [...], although no company has so far developed or acquired an exclusive game that has tipped the scales decisively in favor of a console This is because first-party exclusive games are less popular and represent less revenue than third-party AAA games , which, until now, are available on Xbox and PlayStation."
Finally, the summary concludes as follows: "As we have already seen, Nintendo does not currently depend on any content from Activision Blizzard to be competitive in the market. For its part, Sony has several predispositions [...] : #1 global brand for over 20 years, deep industry experience, largest user base, largest installed base of consoles, robust catalog of exclusive games, partnerships with multiple publishers, brand loyal consumers , etc. — which should help maintain PlayStation's competitiveness in a possible post-operation scenario, even in the face of a possible loss of access to Activision Blizzard content."
According to a report on Tuesday, the US Federal Trade Commission (FTC) could rule on Microsoft's proposed takeover of Activision Blizzard by the end of November.
Meanwhile, the UK competition regulator announced on Tuesday that it had set a deadline of March 1, 2023 for publishing the findings of its investigation into the deal.
The European Commission, for its part, has set a provisional deadline of November 8 to decide on the operation.
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