Round the Campfire

Key insights

7 takeaways

01
Microsoft has signed a ten-year deal to bring Xbox PC games to Nvidia’s GeForce Now cloud-streaming service, securing Nvidia’s support for the Activision Blizzard acquisition.
02
Microsoft previously entered a ten-year agreement to bring Call of Duty to Nintendo platforms, a move intended to alleviate regulatory concerns regarding market foreclosure.
03
The Activision Blizzard acquisition remains under intense regulatory scrutiny, with Microsoft attempting to frame the deal as a benefit to the broader industry while isolating Sony as a market-dominant competitor.
04
Bungie successfully won $4.3 million in damages in an arbitration case against the cheat-software developer AimJunkies.
05
Elden Ring has reached 20 million units sold worldwide.
06
Rovio is delisting the paid, microtransaction-free 'Rovio Classics: Angry Birds' from Google Play, reportedly because it cannibalized revenue from the company's more aggressively monetized free-to-play titles.
07
Activision failed to notify employees for months regarding a December phishing attack that compromised sensitive staff information, including contact details and office locations.

Summary

Microsoft’s ongoing efforts to secure regulatory approval for its acquisition of Activision Blizzard are characterized by a strategic public relations campaign and a series of high-profile concessions. During a February 2023 hearing at the European Commission in Brussels, Microsoft leadership emphasized a commitment to industry-wide cooperation, highlighted by the announcement of ten-year licensing agreements with Nvidia and Nintendo. These deals, which promise to bring Xbox PC titles to the GeForce Now cloud-streaming service and Call of Duty to Nintendo platforms, are designed to mitigate antitrust concerns regarding market foreclosure and cloud-gaming dominance.

The broader industry impact of these maneuvers involves isolating Sony, which remains the primary opponent of the merger. By positioning itself as a proponent of consumer choice and cross-platform accessibility, Microsoft seeks to frame Sony’s resistance as an attempt to protect its own market dominance. However, the scope of these agreements remains a point of contention, as official documentation often focuses narrowly on specific franchises like Call of Duty rather than broader Xbox library access. Furthermore, critics note that these concessions may undermine the original financial and strategic value proposition of the $68.7 billion acquisition.

The analysis underscores the high stakes for Microsoft, noting that the company’s market capitalization has faced significant pressure since the acquisition was first announced. Despite the potential dilution of the deal’s value through these concessions, the company views the merger as essential to its long-term growth. The situation reflects a broader trend of intense regulatory scrutiny within the global gaming sector, where major platform holders must navigate complex legal landscapes to consolidate power and expand their influence in the subscription and cloud-gaming markets.