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Microsoft Downplays Call of Duty To Dodge Takeover Watchdog’s Concerns

After announcing its intentions to acquire Activision Blizzard for $68.7 billion, the Competition Markets Authority (CMA) has claimed that Activation Blizzard and its acclaimed Call of Duty franchise does not hold “significant market power.”

The CMA is seemingly the only thing stopping Microsoft from acquiring Activision Blizzard and the Xbox maker is currently trying to convince the UK regulators that its concerns surrounding the deal are misplaced.

Although there are numerous concerns, the CMA’s primary concern is that the Call of Duty franchise will see Microsoft dominate the video game market by making the popular FPS shooter exclusive to Xbox consoles, putting Sony at a massive disadvantage.

According to Game Developer, Microsoft said that rival Sony has been issuing “self-serving statements” in an attempt to block the deal. Microsoft also previously stated that Sony is currently the market leader in the games industry and that it has a “clear ability to competitively respond” if the acquisition of Activision Blizzard does happen.

Xbox is fighting its corner

In a different statement sent by Microsoft to the CMA in late October, Microsoft downplayed the relevance of the Call of Duty franchise commenting that “Activision content is popular and loved by millions of gamers worldwide. That said, neither Activision nor Call of Duty have significant market power or the status of an ‘important input. All of the CMA’s theories of harm in this case are premised on one overarching concern: that Activision’s game catalogue – in particular the Call of Duty franchise – is so important that it will enable Xbox to foreclose its competitors in gaming. But that is false by any objective measure.”

Microsoft went on to say that Activision’s share in console game publishing is “very low” adding that “even focusing narrowly on the ‘shooter’ genre, Activision would not have the necessary market power to foreclose the downstream market, as the genre accounts for less than a quarter of console publishing revenues.

“Given the incredible array of popular and diverse gaming content that is available to market participants, no title or publisher has ever had sufficient market power in the 30-plus years of console gaming to lead to competitive foreclosure.”

The Xbox makers also stated that the Call of Duty franchise isn’t “unique” when compared to other titles and franchises that are “loved by gamers worldwide,” even suggesting that the franchise is consistently outranked in Game of the Year user polls on PlayStation and on Metacritic.

Unfortunately for Microsoft, the CMA is not the only regulator that stands in its way of acquiring Activision Blizzard as it was previously reported that the Federal Trade Commission in the US is also planning a lawsuit to halt the acquisition. However, the deal has already been approved in Saudi Arabia and Brazil.

Written By

Isa Muhammad is a writer and video game journalist covering many aspects of entertainment media including the film industry. He's steadily writing his way to the sharp end of journalism and enjoys staying informed. If he's not reading, playing video games or catching up on his favourite TV series, then he's probably writing about them.

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