Microsoft’s response to a statement about the Activision Blizzard acquisition from the Competition and Markets Authority has been published, in which MS again looks to convince investigators of the deal and its merits.
In a whopping 111-page document published on the UK government website today, Microsoft responds beat-for-beat to the CMA’s issues statement from last month. The huge statement frequently attempts to convince the regulatory body that neither Xbox nor Game Pass are dominant market forces that could stand to stifle competition should the deal go through, with repeated claims as to PlayStation’s considerable market lead — calling it “the largest console platform for over 20 years, with an installed base of consoles and market share more than double the size of Xbox” — and even going so far as to claim that “Game Pass has no market power today.”
Microsoft claims that “Game Pass has no market power today” in response to CMA Activision Blizzard acquisition statement
The document is heavily redacted so as not to reveal facts and figures which could be considered industry secrets — a shame as some of the numbers not presented would make for fascinating reading, although probably a blessing since it’s already 111 pages long despite the many cuts — but still contains plenty to work with, even with exact numbers replaced with ranges. “Game Pass accounted for less than [0-5]% by value of digital distribution of gaming content globally ([0-5]% in the UK),” it states. “Even just looking at multi-game subscription services alone, it is Sony which if anything is larger in revenues today ([30-40]% compared to [30-40]%).” Even without seeing the exact figures, this would look to back up Microsoft’s claim that Game Pass has “no market power” to some extent by showing it account for just 5% or less of the overall digital gaming market, and suggesting that Sony’s own offerings currently have a slight edge over Game Pass (which could be as much as 10%) from a revenue perspective.
Another interesting passage early in the document compares reported monthly average user (MAU) bases across the two consoles. “PlayStation has more than double the MAUs (close to 60 million more) of Xbox,” it opens, effectively revealing rough figures for both — somewhere a little under 60 million a month on Xbox, and a reported number likely a bit shy of 120 million on the Sony side. It then cites a sadly redacted figure for the percentage of PlayStation users that play Call of Duty, although we don’t strictly need the exact number to see where Microsoft is going with this. “Even if it were to lose all of its Call of Duty gamers, a highly improbable outcome, the PlayStation gamer base would remain significantly larger than Xbox. Sony would need to lose a substantially higher number of non-Call of Duty gamers than actual Call of Duty gamers for its total MAUs to fall to Xbox’s current level (i.e., [redacted] million MAUs),” it explains. “This is not credible, and yet even in such an unrealistic scenario the CMA could not conclude that Sony would be likely to be foreclosed, given that Xbox is a viable competitor today at this same level of MAUs.”
Sony’s own response to the CMA’s statement was also published today, claiming that “Microsoft’s past conduct shows that its public utterances should be treated with extreme scepticism,” going on to cite several instances where it believes statements made by MS about not entertaining exclusivity deals on certain titles were later reversed in what it calls a “bait-and-switch.” We’ve also seen quite the back-and-forth over Call of Duty itself, with numerous statements about the series’ possible future and details about possible deals tabled to keep CoD on PlayStation, not to mention reports that an existing Sony deal could prevent Call of Duty games coming to Game Pass in any case.
What do you make of all of this? Planning on kicking back with 111 pages of light reading yourself to find out more? Let us know!