If Microsoft can create a video game that achieves the same level of success and admiration from gamers as Call of Duty, it will not find itself in a courtroom battle at the end of June. This is the crux of the issue, according to economists, the San Francisco judge, and eagerly awaiting spectators.
Hakim Jacqueline Scott Corley memberikan komentar tajam kepada pengacara yang mewakili Microsoft dan Federal Trade Commission (FTC), dengan menyatakan, “Kami tidak akan berada di sini jika Microsoft telah membuat Call of Duty.” Hakim percaya bahwa undang-undang mendorong individu untuk membuat video game mereka sendiri yang inovatif dan populer daripada hanya membelinya.
The decision on whether Microsoft can acquire Activision Blizzard for nearly $70 billion is in the hands of Judge Corley, who is expected to make a decision within two weeks. Most experts interviewed by IGN believe that Microsoft is likely to win its case against the FTC, although there is a vocal minority that disagrees. Both the FTC and Microsoft have declined to comment on the ongoing case.
The focus of the FTC argument revolves around Call of Duty, or as the judge referred to it, a “shooter video game”. The FTC claims that Microsoft did not create its successful video game itself, but rather wanted to acquire it. Florian Ederer, an economics professor at Yale School of Management, explains that antitrust laws focus on whether a company has organically grown to become a dominant player. If a company creates an exceptional game that leads to a dominant market position, it is not illegal but can be perfectly acceptable. The success of Sony’s God of War is cited as an example of organic success during the court proceedings.
Hakim Corley menantang FTC tentang kemungkinan pengembang game lain dapat membuat sesuatu yang lebih baik jika Microsoft mengakuisisi Call of Duty. Dia mempertanyakan mengapa ada penekanan yang kuat pada Call of Duty dan menyarankan bahwa memaksa orang lain untuk membuat game lain yang sukses bisa menjadi argumen yang valid. FTC menanggapi dengan menggambarkan Call of Duty sebagai game yang sangat sukses dan unik.
Survei bulan Juni yang dilakukan oleh bank investasi Jefferies mengungkapkan bahwa 38% gamer PC dan konsol yang disurvei ingin bermain Call of Duty, diikuti oleh Fortnite dan Minecraft. Mayoritas responden sangat menantikan perilisan judul Call of Duty yang akan datang. Argumen tandingan Xbox adalah bahwa Call of Duty bukanlah game yang unik. Ekonom Microsoft, Dr. Liz Bailey, berpendapat bahwa definisi pasar FTC terlalu sempit dan tidak sesuai dengan kenyataan. Bailey juga menyatakan bahwa jika merger dilanjutkan, game Activision akan tersedia di lebih banyak platform. Argumen Microsoft adalah bahwa pasar lebih besar dari yang disarankan FTC, membuat perusahaan tampak kurang monopolistik. Di sisi lain, FTC berpendapat bahwa pasarnya lebih kecil.
Most analysts interviewed by IGN believe that Judge Corley will support Microsoft, and the other outcomes will be surprising. Ederer notes that the FTC has been very aggressive under the Biden administration, pursuing cases that anticipate new limits on corporate dominance. Microsoft’s ambition to create a monopoly in the rapidly growing entertainment industry sector at such high prices has drawn attention and scrutiny.
However, not everything goes smoothly for Microsoft. The United Kingdom blocked the merger in April, citing cloud gaming as the reason. The FTC continues this argument during the trial, indicating that consoles may become obsolete in the future and be replaced by cloud gaming, where Microsoft has an advantage.
During the trial, the FTC presented two emails from Matt Booty, the head of Xbox Games Studios, as evidence. In a 2019 email to the Xbox CFO, Booty stated that Microsoft could “outspend Sony out of the business.” He emphasized that content was their competitive advantage and stated that spending billions of dollars would be beneficial in staying ahead in the competition. Microsoft responded by stating that the email was from three and a half years ago and unrelated to any acquisition.
In the 2021 email, Booty expressed that Xbox is unlikely to make its original games available on rival streaming or subscription services.
The judge’s decision is only the first step in a lengthy process, depending on the outcome. If the FTC loses the trial, they can appeal the decision and try to stop the court order. They can also continue their case against Microsoft even if the merger is completed. Activision Blizzard will receive a $3 billion break-up fee if the deal fails, and if successful, CEO Bobby Kotick will receive around $400 million.
The deadline for the agreement is July 18, and if the judge opposes Microsoft and Activision, they may have an opportunity for renegotiation. We will closely monitor the judge’s decision during the trial. Shannon Liao, a prominent video game journalist, has extensively covered the trial and provided updates on Twitter and Substack.
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