You can see the look of Satya Nadella above. That’s a look of confidence that can only come when you’re the CEO of one of the world’s biggest and most recognisable companies. That confidence relates to every business decision the company makes, including the biggest ever acquisition in the gaming space, that of Microsoft’s acquisition of Activision Blizzard King. Nadella has this week expressed his confidence in their ability to seal the deal in spite of external pressure of PlayStation’s own Boss Jim Ryan, and the UK’s Competition and Markets Authority (CMA), whose own Senior Director of Mergers, Sorcha O’Carroll said,
Following our Phase 1 investigation, we are concerned that Microsoft could use its control over popular games like Call of Duty and World of Warcraft post-merger to harm rivals, including recent and future rivals in multi-game subscription services and cloud gaming.
If our current concerns are not addressed, we plan to explore this deal in an in-depth Phase 2 investigation to reach a decision that works in the interests of UK gamers and businesses.
Nadella though is seemingly unphased, an approach that you can probably only bring when you have a market cap of $1.8 Trillion, and, in an interview with Bloomberg he indicated as such saying, “Of course, any acquisition of this size will go through scrutiny, but we feel very, very confident that we’ll come out”
Nadella was also quick to note Microsoft’s market positioning within the global industry, which, depending on the metrics you’re using will have Microsoft sitting behind competitors Nintendo, and Sony, as well as Tencent who is gradually devouring gigantic portions of the industry. Nadella set a particularly dangerous shot over the bow to Sony in particular, who themselves have been acquiring studios but have been vocal in their frustration over Microsoft’s actions commenting, “So if this is about competition, let us have competition”, words that will undoubtedly strike a degree of fear within Sony executives because financially, they simply don’t have the means to keep up with Microsoft (Sony’s market cap is a mere $86.8 Billion in comparison to Microsoft’s.)
With seemingly infinite pockets, you’d be forgiven for wondering how much further Microsoft could go if they really decided to go further on the aggressive, Nadella was keen to discuss Microsoft’s place in the broader economy given the impact of inflation and increased interest rates. He again was expressing confidence,
The constraints are real. Inflation is definitely all around us. I always go back to the point that in an uncertain time, in an inflationary time, software is the deflationary force. [Microsoft is] ensuring that our customers are able to do more with less. So, in terms of outlook, I am optimistic about Microsoft’s value proposition. I’m optimistic about our share, but we are not immune from anything that is a macroeconomic headwind.
No matter how you slice it, Microsoft looks well positioned to continue to build its presence in the industry, whether they land Activison Blizzard King or not.
