Microsoft has revealed some interesting things about where Activision stands in the situation of its pending acquisition by Microsoft, in the investigation by the UK CMA.
This is part of Microsoft’s 100 page document, responding to the CMA’s request for comment on their investigation to Microsoft’s acquisition. Microsoft is trying to argue that if their purchase gets finalized, that there would be no serious consequences to competition, specifically when it relates to Activision.
Microsoft pointed out that Activision’s games, including the juggernaut in the middle of the firestorm, Call of Duty, but also their smaller legacy games like Crash Bandicoot or the recently revived Tony Hawk’s Pro Skater, are not on any subscription services
As Microsoft pointed out, Activision itself does not believe in subscription. While they won’t make their full perspective public, they believe bringing their games to subscription services would actually hurt their games and/or profitability somehow. They do argue that it would harm their brand, and also their decision to use the buy-to-play sales model.
Of course, if Microsoft becomes the owner, they could force Activision to change their mind, or even make these choices for them. But Microsoft revealing Activision’s position in this way is probably intended to demonstrate that neither Activision nor Microsoft has an incentive to make Call of Duty part of Game Pass. Also implicit in this statement is that Microsoft would not be forcing them. Microsoft’s public statement is that their interest is actually in Blizzard’s games. According to Phil Spencer, Microsoft wants to leverage Blizzard’s mobile gaming division to bolster their own.
On the off chance that the acquisition does not push through as a result of these investigations, it may be the case that Activision will continue to not be a part of any subscription services, and the company itself would not be starting one. All the way back in 2011, Activision did try such a model, with Call of Duty Elite. Activision tried to sell Call of Duty fans on a smaller subscription so they did not have to buy the game’s DLC packages piecemeal. At the time, their subscription service faced multiple outages and technical issues. Ultimately, Activision pulled out and brought what they learned to their mobile initiatives.
It’s interesting to consider this perspective as Sony would have you believe Activision is eager to make money with whoever’s offering the most money. It would seem Activision is a wiser game studio than most gamers believe, and they aren’t going to be hasty on making decisions that would make money in the short run, but harm then long term.
Below is the text of Microsoft’s statement on Activision’s position, edited for clarity. Please note specific sections were excised because they include confidential information that the CMA has voluntarily removed from the document, to avoid public scrutiny.
“Without the Merger, Activision content would not be available on multigame subscription services. The Merger can therefore not make competitive conditions worse, under any circumstances.
- Activision does not make its games (including Call of Duty) available in any meaningful sense to any multi-game subscription services, nor is there any evidence that this is likely to change in the foreseeable future. It is therefore not possible that Activision games are an “important input” for subscription services or that such services could be “foreclosed” by not having access to them post-Merger.
- Activision’s ordinary course internal business documents, as well as the sworn testimony of its executives, has made clear that there are no plans to do so in the future absent the Merger. Activision is concerned that participation in subscription services could impact its [line redacted] and would lead to brand dilution and cannibalisation of buy-to-play sales (especially of new releases). This reflects Activision’s view that even if the subscription business model were to grow, the [redacted]. This has been a fundamental impediment to publishers more generally agreeing to place their content on subscription services, a stance which is not going to change in the future.”
Source: Pledge Times
