There are serious concerns being raised around the world over Microsoft’s planned $69 billion purchase of Activision Blizzard, with opposition coming not just from Xbox’s competitors but everyone from Google to Nvidia as well. You would think such a precarious situation would require some delicate diplomacy, but then, this is Activision we are talking about here.
A few days after an Activision executive blessed the world with a completely unhinged, Last-of-Us-themed take on the deal, the company’s CEO Bobby Kotick has gone on TV to defend the proposed purchase and plead Activision’s case.
Appearing on a CNBC business segment, Kotick begins the interview in a fairly sedate, level-headed way, talking about the uncertainties in the video game industry and the economy as a whole.
Pleasantries aside, things move quickly onto the Microsoft purchase. “Whether it’s the FTC or the CMA or the EU, they don’t know our industry”, he says. “I don’t think they fully appreciate that it’s a free-to-play business, that the Japanese and Chinese companies dominate the industry.”
“You look at Sony, you look at Nintendo, they have these huge libraries of intellectual property. Sony has Sony Studios that goes back 80 years, Nintendo has the very best characters that exist in video games.”
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He then says the biggest companies in the world are now Chinese operations like Tencent, who enjoy “protected markets”, and cites Activision’s own “struggles” to enter the Japanese market as proof that the real competition in the video game space today isn’t between American and European companies (ie, the ones they’re trying to merge) but them and the Asian giants.
We could sit here all day and pick through these comments. Like how huge parts of the games industry, from Call of Duty to Bethesda’s lineup to most of Blizzard’s games to Xbox’s Game Pass, are not free-to-play. Like how Sony Studios might be useful occasionally for stuff like Spider-Man, but is also full of movies like like Basic Instinct and Paul Blart: Mall Cop. Or how saying three of the world’s biggest consumer watchdogs—who currently hold the fate of your proposed $69 billion purchase in their hands—have no idea what they’re doing may not be a great idea.
Most extraordinary, though, are his comments at the end of the interview. There were reports over the weekend that the UK’s Competition and Markets Authority is leaning towards saying “no” to Microsoft’s purchase, which would seriously threaten the whole thing. Responding to that looming threat, Kotick simply says that should the UK try and block the deal it’s ambitions of becoming Europe’s own Silicon Valley would be toast.
…if you look at the UK and think about the post-Brexit UK, it’s probably the first country where you’re seeing a recession, like the real severe consequences of a recession. If you’re the UK, and you have an incredibly educated workforce, you have a lot of technical talent, places like Cambridge, where the best AI and machine learning is, I would think you would want to embrace a transaction like this, where you’re gonna see job creation and opportunity, and it isn’t really at all whether it’s Sony’s or Microsoft’s platform, it’s really about the future of technology and you know they’ve said now for the last year...that would like to be the Silicon Valley of Europe, or of the continent, and if deals like this can’t get through, they’re not going to be Silicon Valley, they’ll be Death Valley.