Microsoft has been forced to issue a letter to the New Zealand Commerce Commission in an attempt to defend its bid to acquire Activision Blizzard. Before the purchase can be confirmed, various markets where Activision operates will have to comply with the competition laws in each region before Microsoft can officially say “we own Activision”. This is a typical legal procedure that takes place to ensure that a large company acquisition like this doesn’t disrupt the industry.
In a letter sent to the New Zealand Commerce Commission, Microsoft openly admits that the company doesn’t see any games that Activision Blizzard develops as “must have” titles. The company says that there’s nothing unique about the video games developed and published by Activision Blizzard for rival PC and console distributors that could give rise to a foreclosure concern.
The letter is a lengthy one that details the commitment Microsoft has undertaken to ensure the acquisition doesn’t disrupt the industry nor affect employment around the globe. It also details the PlayStation partnership and the Call of Duty franchise released on Sony’s platforms. It states:
Microsoft has demonstrated that it is not withdrawing content from other platforms, having made multiple public statements that it will continue to make Call of Duty and other popular Activision Blizzard titles available on PlayStation through the term of any existing agreement and beyond. Microsoft has also publicly stated that it is interested in taking similar steps to support Nintendo’s platform.
It also goes on to detail Microsoft’s distribution process for games going forward and specifically mentions the “exclusivity” of Activision Blizzard games on Xbox services.
The merged entity will not have the ability or incentive to foreclose rival video game developers and publishers by restricting distribution through limiting access to Microsoft’s digital storefronts, including the Xbox Store (or other Xbox console-specific digital storefronts)
In light of the wide range of alternative distributors there is not an ability to foreclose rival video game developers. These alternatives include Sony and Nintendo with significantly larger shares of the global console distribution channel; Tencent, Valve and many others on PC; and a vibrant range of well-resourced new entrants including Google, Amazon, and Meta (Facebook)
While this doesn’t lock Microsoft out of offering exclusive experiences to Xbox gamers in the future, the letter is trying to prove that the purchase of Activision Blizzard is safe and won’t damage the industry in any way. It is quite interesting to see Microsoft deem Activision Blizzard games as not “must have” titles. You can read the full letter here.