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The FTC has decided to sue Microsoft over the Activision Blizzard Acquisition but this might backfire on Sony if Microsoft wins in court, and here’s why.
Foreign It's going to be a little bit different We do have the game awards today so I Don't want to interfere with all that I Am pumped to watch that showcase myself And we'll talk all about that tomorrow But for today some breaking massive news Just happened of course all year long We've been talking about Activision Blizzard and that looming buyout but Today the FTC just did the unthinkable Seemed like everything was trending in The right direction for Microsoft and That the Activision Blizzard acquisition Was going to go through with no problems Other than some concessions we've been Talking a lot about that as of recent There was even a report earlier this Week that the FTC panel seemed to be in Favor of Microsoft buying Activision Blizzard but that's not actually how it Played out in reality things instead Just hit the fan the FDC today announced They are suing Microsoft in an attempt To block the acquisition now Sony's Probably pretty joyous over this Announcement this is something that They've been rooting for all along but Everybody needs to just kind of hold up Here for a moment because this is not Over this is actually far from over and This could blow up in her face in the Long run so we're gonna go over all this Today and what all this means going
Forward first though let's just kind of Go ahead and take a look over here at The ftc's official statement and why They decided to try and block the Acquisition it says the FTC seeks to Block Microsoft's acquisition of Activision Blizzard agency alleges that Maker of Xbox would gain control of top Video game franchises enabling it to Harm competition in high performance Gaming consoles and subscription Services by denying or degrading Rivals Access to its popular content now they Later on go on to say that Microsoft has Already shown that it can and will Withhold content from its gaming Rivals Today we seek to stop Microsoft from Gaining control over a leading Independent gaming studio and using it To harm competition in multiple Dynamic And fast-growing gaming markets now that Is a loaded statement and it is Interesting that one of their key Arguments is about subscriptions and Fast growing gaming markets we'll get Into that in a little bit the big Question here is whether or not any of This holds any Merit we have talked About this possibility before if the FTC Decides to take this acquisition to Court which they're now doing then I'll Have to prove in the court of law that This could in their words damage Competition which is a very interesting
Direction to take considering Sony's Dominant lead in the game industry not Just for the PlayStation 5 but for Nearly three decades Microsoft is a big Company and that's what the FTC sees but When it comes to gaming Might be a little bit of a different Story there you can't simply punish Microsoft because they're a big tech Company you do have to kind of look at The context here but nonetheless Microsoft quite frankly has a great case In the situation as a lot of the Concerns brought forth Does have holes in them if we want to Talk about exclusivity Microsoft can Easily easily point to Sony's own Exclusive games which have been quite Successful and how they've also acquired Studios they can easily also point to Sony buying third-party games like Final Fantasy VII you have Street Fighter and The list goes on and on exclusives in The game industry It's not a new thing now if we want to Talk about competition again Xbox is in Third place in terms of the console Market if we want to talk about Consumers and whether or not it affects Them negatively it seems like the Primary focal point remains on Call of Duty and as we saw yesterday Microsoft Did sign a 10-year contract with Nintendo it can very easily be argued
That that is good for gamers they also Attempted to sign a contract with Sony And they also offered valve Adele as Well so they did offer concessions and They have remained committed in bringing Call of Duty to more platforms and not Less that is an extraordinary point to Bring up in court and as long as that Stays true It would be incredibly difficult to Argue that that's not better For gamers again they are bringing Call Of Duty to more Gamers not less that That's kind of been the whole point all Along see the problem with what the FTC Is doing is that they're aggressively Trying to make an example out of these Big Tech mergers regardless if it Coincides with the law or not regardless If they have a good case or not and it Does seem like when it comes to most People and most analysts they do seem to Believe that Microsoft has a good case That can easily easily hold up in court This is why under Lena Khan's leadership The FTC has lost several cases in court They continuously try to make an example Of these big tech companies And they keep felling this is also one Of the reasons it was believed that they Would take Microsoft's concessions and Call it a day everybody would have went Under that situation Microsoft would Have completed the buyout in a timely
Manner which is what they want while the FTC could go on bragging about getting Concessions But nope instead the FTC they chose Violence they are instead out to make a Point Microsoft though they have Responded and we're going to take a look At a few different statements that they Made so the first of which is coming From Microsoft's Vice chairman and President Brad Smith as he says we Continue to believe that this deal will Expand competition and create more Opportunities for gamers and game Developers we have been committed since Day one to addressing competition Concerns including by offering earlier This week proposed concessions to the FTC while we believed past tense while We believed in giving peace a chance we Have complete confidence in our case and Welcome the opportunity to present our Case in court so Microsoft is going to Fight against this and in that last line About giving peace a chance Is incredibly intriguing let me explain Why see this could actually blow up in a Major way for both the FTC and Sony if They indeed lose in court the reason I Say that is because if they would have Accepted the concessions Microsoft would Have been obligated to support PlayStation consoles for 10 years But that's now out the door if Microsoft
Wins in court They're not obligated to do anything After that and let me tell you if that Does actually happen suddenly that 10-year contract is looking pretty nice That sounds a lot better than zero Guarantees for PlayStation Now Personally if you're asking me in my own Opinion I believe that Microsoft will Still support PlayStation with Call of Duty and I think that this is something That they're going to bring up in court I believe that they have every desire to Release that on Playstation regardless Of a concession or not but I mean it Also kind of depends on how angry they Are over the situation I mean I'm Positive that they're probably just so Fed up with Sony's Behavior over this Entire situation Sony in a lot of ways Could be Burning Bridges here not just With Microsoft but also with Activision Blizzard Activision Blizzard wants to be Acquired and I'm sure they're not Thrilled with Sony's reactions to this Entire situation either I mean it's it's A business at the end of the day and These these companies are always going To do what's best for the business but If Sony at the very least they are going To damage their relationship with the These companies going forward Microsoft They tried to play nice guy and that Didn't work so technically they could
Completely pull the rug from underneath Sony if that's something that they Wanted to do you also have to keep in Mind other franchises Not Just Call of Duty yes that's kind of been the big Focal point but suddenly it would become A lot more doubtful that franchises like Crash Bandicoot spy with the dragon Starcraft World of Warcraft or or all These other games etc etc appears on PlayStation consoles ever again if Microsoft wins in court because they're No longer forced to play the nice guy I Mean if you think about it I could see a situation where Microsoft Keeps Call of Duty multi-platform that's What they have continuously said but Then they could also keep Crash Bandicoot 5 exclusive to Xbox so while The big story here is Microsoft is being Sued This is actually a risky move for Sony And the FTC and even more so considering Microsoft actually has a case I mean as I've already mentioned the FTC under Lena Khan's leadership has already lost Several cases she doesn't exactly have a Great track record here so if we follow History this could end up being very bad For both the FTC and Sony now however It's certainly not a 100 guarantee that Microsoft will win and it you know it Also might take a while but Microsoft Does have a case that could hold up in
Court that's kind of what I'm trying to Say here there is risk involved so on One side the FTC could have maybe gotten A win by simply taking those concessions That probably would have been better for Everybody involved they would have shown That to FTC fought for concessions and Got those concessions while on the other Side Microsoft would have completed the Deal faster which is what they want but That's Off the table now now speaking of what Will happen in court Activision Blizzard's Lulu Chang posted this over On Twitter in response to the FTC she Says the ftc's job is to protect Consumers not competitors the vote Departs from precedent but the law Hasn't changed any claim the deal is Anti-competitive ignores the facts the Deal benefits Gamers and the industry Especially given competition from abroad We look forward to proving our case in Court and closing our deal with Microsoft And that right there is the key point to This case the FTC is supposed to protect Consumers and not competitors but if you Look at the reasoning the FTC is suing And their own words it's because it Could harm competition now they did Later on say that by Microsoft Withholding content does harm consumers But that was kind of the point with the
Concessions in which they refused to Accept now even still if Microsoft Remains adamant that they plan to keep Call of Duty multi-platform that is the Big focal point of this entire case Well that bodes well from Microsoft now We'll see if other franchises poses an Issue or not in court we'll have to kind Of see about all of that there is one Argument though that I have continuously Found to be interesting and this is Where I could see Microsoft having some Issues and that's with game Subscriptions the ftc's argument is that This is not just about consoles but also About cloud gaming and subscriptions Which is where Microsoft is in a more Favorable position yes Microsoft is Third in the console Market but when it Comes to game subscriptions and cloud Gaming it's a little bit different now There are things Microsoft can fight Back with this though we've seen them do This already and they have pointed out That Sony's lack of a true Game Pass Competitor is not because they can't Make a competitor but rather it's Because Sony just doesn't try they're Not truly committed to it Sony instead Chooses to sell 70 games which they've Been very successful in they just quite Simply have a different strategy than Microsoft but that's a business decision You can't really punish Microsoft for
Doing something different and plus the Proof is kind of putting here Game Pass Offers consumers more options which is Good for consumers and Microsoft's eyes And they've said this before this should Be encouraged not discouraged and I Think that that's a very good point here Again if we're going to make this about Consumers the addition of Game Pass is a Very very good thing they can also show That PlayStation Plus technically has More subscribers by including all their Tiers very similar things can be said About cloud gaming as well Microsoft is Pushing more into the cloud-based market In terms of gaming but it's open game For anybody Microsoft does not have a Dominant lead when it comes to cloud Gaming as it's still in its infancy Stage and the mass Market has not bought In the cloud gaming up to this point Yeah I would say that the FTC is trying To extend their reach a little too much When it comes to cloud gaming now with All that said though I mean this is Certainly not good news for Microsoft And I don't want to make it sound like That as they they wanted to get this Buyout done as fast as possible but I Don't really look at this news as good For PlayStation either Yes it delays the acquisition but it Doesn't necessarily stop it so this is a Risky move that could blow up in her
Face considering those concessions are Now no longer on the table now we'll see About that situation what Microsoft Plans to do if they do win in court But one other interesting thing to kind Of followed here is the domino effect That this could cause it's been believed For quite a while that the FTC could be An indicator on what the EU and the CMA Does so we could maybe possibly see a Similar thing happen in those markets as Well so we'll kind of monitor that Situation as well it could get ugly over There but what you all need to know for The time being is that this is far from Over I was hoping that we could be done With these Activision Blizzard topics Soon I mean we've talked a lot about This stuff uh but yeah things are about Ready to get even more chaotic let me Know what you all think about all this Though do you think Microsoft will win In court or instead are you on team FTC Do you think they will win I look at Microsoft's case and I I just think to Myself yeah they they do have a pretty Good case so I think that this might Have delayed the inevitable rather than Just flat out stopped it we'll see if I'm right or wrong about this in the Long run but let me know what you all Think in the comments below with that Said that like I said there's a little Bit of a different episode so that is it
But I'll see you all tomorrow and we'll Talk all about the game awards as always Though if you enjoyed the video make Sure to hit that Bell notification And Subscribe button for more content just Like this also if you'd like to support The channel to patreon thank you for Making this content possible Peace out
