I know a lot of people here are anti-big tech and I am too, to a certain extent, but I want to play devil's advocate here and provide my case for the deal:
Activision-Blizzard was in total corporate chaos before the deal was announced, the CEO (Bobby Kotick) was accused of permitting workplace sexual harassment and employees at the company were on the verge of mutiny. They were also seen as a stagnant publisher that only cared about its billion dollar franchises (Call of Duty and Candy Crush) while letting its other IPs like StarCraft and World of Warcraft rot and turning the beloved Diablo into a cash-grab pay-to-win mobile game. The Microsoft acquisition would have likely breathed some new life into the company and allowed corporate to clean up shop. This will probably lead to Activision-Blizzard continuing on its previous, doomed trajectory that it was on back in 2021.
I agree with most of this, but this isn't an argument for Activision-Blizzard merging with Microsoft, this is an argument that Activision-Blizzard shareholders need to throw out Bobby Kotick and his folks, and replace them with competent leadership (or really, anyone with a pulse who won't union-bust and won't sexually harass people, would be more qualified at this point).
It's ridiculous that a company with this many talented people, and this much treasured IP, is languishing in this state and tied up with such easy-to-avoid internal-only mistakes.
> The Microsoft acquisition would have likely breathed some new life into the company and allowed corporate to clean up shop
Maybe. But it seems more likely that Microsoft would have cleaned up leadership a tiny bit and then left Activision-Blizzard to slowly quietly rot away, in much the same way that Microsoft has treated Halo.
Shareholders can get rid of Bobby Kotick and do all kinds of other leadership changes and it's not going to fix some of the problems that some of us were hopeful for.
Microsoft has shown some resolve when it comes to supporting games in spaces that aren't absolute gold mines, specifically in the Real Time Strategy (RTS) genre. They are publishers of Age of Empires, which all things considered is a drop in the bucket when revenue wise, yet it still is allowed to exist. Blizzard (via Activision) mostly exploits or kills all of it's "less-than" products, which increasingly is almost everything when compared to the behemoths like Call of Duty and Candy Crush.
It was probably a bit of wishful thinking, but some of us were actually excited that Microsoft would get access to some of the games that don't get supported very well while the customer base is literally holding their wallets out asking to pay to support the game. For example, Heroes of the Storm does have a dedicated following and we're ready to pay $10/mo or something similar to help support the game, but it's literally spent the last three years patching after every time it runs because it's broken. It still plays fine, but it eats gigabytes per month of bandwidth all because nobody cares enough to modify an XML file or something.
The same is true of Diablo II: Resurrected. It's a great game, but we can't pay for extra stash tabs which in the ARPG genre is kind of the go-to monetization strategy these days. Everyone would be fine paying $5 for a few stash tabs and it would be a good way to support ongoing development and maybe pave the way to getting the long awaited "Act 6" content everyone would love or even just allow the team to spend a bit more time adding more end-game meta content.
See I go back and forth about this. I feel the same optimism in some ways about Microsoft getting their hand on the wheel...but they've also let a lot of great IP's languish that they already hold. Rare is a shell of its former self and is basically only around because of Sea of Thieves which really took a while to get the ball rolling, Lionhead hasn't released a game in over a decade, Halo is on life support, Gears is doing ok, Forza is doing good-ish I guess. Lots of examples to choose from, sadly.
That's a good counter-example. Forza Horizon 5 was released to much acclaim in terms of the actual game, but the release was plagued with terrible microtransaction problems that overshadowed it and caused the player base to revolt.
Agreed. But tossing leadership & getting new supposedly 'better' leadership is high risk, whereas an acquisition is low-risk and more reliable at getting short term gains.
There's a substantial portion of the tech startup sphere whose entire goals are: get big enough to get acquired and get a big bag from the sale. It kind of runs counter to current sentiment around here.
> It's ridiculous that a company with this many talented people, and this much treasured IP, is languishing in this state and tied up with such easy-to-avoid internal-only mistakes.
It's why they are languishing. It's the "resource curse". On the contrary, It's one of the reasons why Microsoft is a killer machine. They are disciplined and focused. That kind of discipline stifles away creativity (like Skype and yammer).
One is a solution that fixes the issue now, the other is us hoping for shareholders to eventually do the morally right thing (which is a silly thing to expect).
It is crazy how Blizzard was a few hundred employees when they released Warcraft, Starcraft and Diablo over a couple years. Now with 50X as many employees and 23 years of effort they have done nothing but coast off their original hits.
I don't know why this happens but it seems to occur again and again in gaming with indie studios that get acquired.
Modern games are just way more complicated and all the assets have to be a lot higher quality. The assets especially just take a lot more work to do.
A single character model can have more polygons then a whole game back in the day. The textures are also way more detailed, animations are more fluid/realistic, etc.
This is why a lot of effort is being put into helping developers to make content faster with things like automatically generating large parts of levels/worlds (basically a developer puts in the important parts manually and some system fills in the rest) and automatically generating and animating humanoid models (MetaHuman), etc.
For example here is nice video about using MetaHuman with basically just a phone for face capture as input https://youtu.be/pnaKyc3mQVk?t=72
>Modern games are just way more complicated and all the assets have to be a lot higher quality.
This is nonsense. Very few gamers actually care about how many polygons make up each tree and that some texture in the background is 10mb compressed. Meanwhile the actual product of video games from AAA companies has stagnated immensely. You can make your game ugly as sin, and if it's actually fun, people will love it. Every indie darling is an explicit disproving of this claim. We have Minecraft, factorio, cruelty squad which is entirely built around being horrible to look at but fun to play, an entire genre of "old" looking games that don't actually look old. There's even an entire world of games that look good with assets that you can buy on an open market for a few dollars each.
I wouldn’t mind if the game was fun. Many of my favorite games to this day have terrible graphics. A nice side effect of simple 3D forms or even 2D games is that you also don’t require a massively expensive GPU or even a dedicated GPU at all in order to play them.
>> Modern games are just way more complicated and all the assets have to be a lot higher quality. The assets especially just take a lot more work to do.
I mean… if this is the case, how did Vampire Survivors become a huge hit and win multiple game of the year awards, and result in countless clones?
Even if we have brain-interface full immersion virtual reality, you can still have fun throwing cards into a hat. In fact you will prefer it.
Games are like food rather than cars. In food, high quality food doesn't really push out low quality food. Even a billionaire will want a grilled cheese sandwich sometime. While in cars, you can say that in general people would like the more expensive cars rather than cheaper ones.
To me this puts a hard limit on upside of quality for games. It doesn't matter how many thousands of hours of dialogue you have voiced and motion captured if a vampire survivors could always eat your lunch.
Problem with something like Vampire Survivors is that the quality of game you make has very little to do with its popularity. Even poncle (the guy who made VS) admits this as there were many very similar games before VS and many after it. Some of those are objectively better video games but just never got popular. VS is basically an indie movie becoming a mainstream hit equivalent of video games.
This is very different to something like Call of Duty, Diablo, The Last of Us, etc where you put a lot more money into the game and if you actually make a good game (and fund a large marketing budget) it will most likely sell well. Same recipe works for Disney and other large movie studios.
Basically if you went to watch the next Marvel movie and you were greeted with $50 000 budged indie movie special effects and the no big name cast it gets you would you be a satisfied customer? (and you were expecting Marvel movie special effects and big star actors)
And something like Call of Duty makes more money every month then Vampire Survivors has made in the ~1 year it has existed.
It was developed by a small independent team within Blizzard who iterated like crazy and created prototypes with Adobe Flash. At one point they transferred basically the entire team to work on finishing StarCraft 2 temporarily and left the two principal game designers to continue iterating for 10 months.
Hearthstone ended up being a smash hit and their first properly new game since they released World of Warcraft. All because they gave a small creative team the freedom to explore those ideas.
How do you reconcile this belief with big tech companies being some of the largest bureaucracies on Earth, yet they continually build incredible and unique products?
> Amazon overall generated $24.8 billion in operating profits in 2021, and AWS was responsible for $18.5 billion (or 74%) of it. Basically, a business segment that contributes 14% of overall revenue is generating roughly three-quarters of Amazon's total operating profits.
When I consider that this turnaround seems to have happened right after they were acquired by Activision, it becomes less of a mystery. I suspect many of those original few hundred employees didn't stick around after their employer suddenly changed and those who left would have primarily been the most influential Blizzard people. There really is no "Blizzard" anymore except as it's tacked on to "Activision-".
I think that's a big element of this. The sort of quality bar we see in StarCraft or WarCraft III would come across as kit-bashing or stylized low-budget indie today. Shipping a AAA-style game in a timely fashion needs a larger production process than earlier works.
The sort of issues around engineering and linked-lists[1] in the original StarCraft wouldn't really be an issue today. Teams are operating in a very different way.
> and turning the beloved Diablo into a cash-grab pay-to-win mobile game.
A decision which has made them a metric shit-ton of money. Why would they stop when they've found a winning formula? And why would Microsoft decide to stop such an easy revenue stream? Sure the Diablo name is being dragged through the mud (among a particular demographic, at least) but the consequences for that are years or even decades away. If anything, "cleaning up shop" might mean shutting down the less profitable divisions - something Blizzard has been actively doing anyway.
> This will probably lead to Activision-Blizzard continuing on its previous, doomed trajectory that it was on back in 2021.
Maybe their trajectory is doomed when measured in decades. Right now they're printing cash. I think they're happy to abandon their legacy "core" audience in exchange for the gacha whales that will pay them multiples more for a cheaper-to-make experience.
I realize that a lot of us grew up with Blizzard games, I myself have all the CE boxes they shipped since Warcraft III. But the people who made those experiences are generally long gone. A change of ownership is unlikely to radically change priorities or bring back the magic.
To be fair, looking at how both Diablo 4 (PC/Consoles) and Diablo Immortal (Mobile) are doing today, they seem to be on the way to capture both audiences with solid products in either side.
Mobile gaming industry sucks so much, D:I is actually a good product there. It offers so much more than your regular ad-infested crap with "recharge energy" mechanics at the very least. It might be the worst compared to what is available on PC/consoles, but those are different audiences. For the more informed consumers Blizzard has Diablo 4, where they seem to restrain greed to somewhat acceptable levels.
Yes they've fumbled with their PR back then, might've made one of the worst presentations in industry history (look at Bethesda & Fallout Shelter and see it being masterfully done) and generally been incompetent in a few of their recent titles (W3: Reforged and OW2 comes first into mind), still, looking at it today, Diablo as a franchise looks like a right step than otherwise.
If you wanna play devil's advocate, at least try to answer the concerns voiced by the watchdog.
The concern is not who can develop the existing IPs the best or if Activision/Blizzard will continue to exist. The concern is that Microsoft already has a strong position, and consolidating it further will make it even harder than it is for new entrants to have any chance.
> “Microsoft already enjoys a powerful position and head start over other competitors in cloud gaming and this deal would strengthen that advantage giving it the ability to undermine new and innovative competitors,” Martin Coleman, chair of the independent panel of experts conducting this investigation, said.
If you're still up for playing devil's advocate, come up with an argument against that this acquisition wouldn't consolidate anything in Microsoft's favor, and as a result lead to fewer consumer choices.
Microsoft is pretty consistently in last place in console market share and the Xbox brand is dwarfed by Sony and Tencent (China).
Microsoft's strong current position in Cloud Gaming isn't because XCloud is devouring all the competition, its because the competition barely exists in the first place. Google and Amazon left their cloud gaming products to rot and GeForce now is very janky (but still quite popular from what I've heard!). Google and Amazon's mismanagement of their products doesn't automatically make XCloud into an aggressive anti-competitive monopoly, especially when you consider the fact that Microsoft inked a 10-year deal with Nintendo's cloud gaming provider to provide Call of Duty to the platform last month.
As someone who was using GeForce during the pandemic it is a great service but janky is an understatement. There are a huge number of common "edge" cases I've run into: getting long passwords into games, passing mac keyboard commands to essentially windows buttons, etc. Still, it is AMAZING being able to play any game anywhere. But I'm not sure if the market for these products were/are big enough for so many players so pretty much everyone has dropped out.
I don't like this method of measuring a company's competitiveness with how popular they are with consumers. Just because MS can't cobble together a decent product that people enjoy doesn't mean that they should just be allowed to buy sectors of the market until they have a good majority. Maybe they are just releasing shit products despite having as many or more resources at their disposal compared to their competitors.
Picture this feedback loop:
- Microsoft has 20% market share
- Microsoft buys company Y, bringing them up to 35%
- Microsoft ruins company Y's product with their awful leadership
> In relation to console gaming services, we found that Xbox (Microsoft) and
PlayStation (Sony) compete closely with each other, and that Activision’s Call
of Duty (CoD) is important to the competitive offering of each. The evidence
suggests, however, that Microsoft would not find it financially beneficial to
make CoD exclusive to Xbox after the Merger. We also found that making
CoD available on Xbox on better terms than on PlayStation would not
materially harm PlayStation’s ability to compete. On this basis, we found that
the Merger would not substantially reduce competition in console gaming
services in the UK.
> In relation to cloud gaming services, we found that Microsoft already has a
strong position. It owns a popular gaming platform (Xbox and a large portfolio
of games), the leading PC operating system (Windows), and a global cloud
computing infrastructure (Azure and Xbox Cloud Gaming), giving it important
advantages in running a cloud gaming service. With an estimated 60-70%
market share in global cloud gaming services, it is already much stronger than
its rivals.
> We found that the Merger would make Microsoft even stronger and
substantially reduce competition in this market.
According to the people who done this research (CMA), they seem to say MS already have a 60-70% marketshare, and making that higher via a acquisition, will make it harder for others to enter the market.
CMA of course cannot make competition to step up, but they can try to stop incumbents from becoming monopolies, which is what's happening here.
This is just my opinion obviously, but I don't think those advantages particularly matter for gaming.
1. Gamers don't want cloud gaming. Latency matters. Cloud gaming is at best an addon for when you can't use your console.
2. Xbox is the least popular gaming platform. If things keep going the way they are I would not be surprised if Microsoft got rid of Xbox before the next console cycle.
3. Windows being the leading operating system has no impact on the gaming industry
This honestly reeks of an analysis done by outsiders that don't actually understand the industry. On the other hand, this consolidation also sucks to see.
Again, CMA is not investigating what matters for gamers or not, but investing what market hold the entity has, if they are likely to abuse it and if the acquisition would make the market hold stronger.
In the case of consoles, their own argument is that no, the market hold would not grow stronger.
In the case of cloud gaming, their argument is that Microsoft already have a strong hold on the market (in the UK) and the acquisition would likely lead to a stronger hold.
Xbox as a console and Windows as a OS and nothing to do with the case they're making.
> This honestly reeks of an analysis done by outsiders that don't actually understand the industry. On the other hand, this consolidation also sucks to see.
Yes, because they are not experts in the gaming industry, they are experts in the industry of businesses in general, and monopolies.
Same could be said about your own argument, it reeks of an analysis done by someone who have no grasp on wider markets and monopolies, but happens to have knowledge about gaming to some degree.
I guess what we disagree on is that conclusion. "Cloud gaming" is not a real market. It's a subsection of the larger gaming market, it will never grow much bigger than it currently is, and by the reports own admission it would be against Microsoft's interests go for anti competitive moves. Unless there's some miscommunication around what "cloud gaming" is, I don't see how their justification makes sense.
On the other hand, while this aquisition might not strengthen the console market, it would go a long way in preventing Microsoft from exiting the market. If Microsoft exits the market that will be a huge blow to gaming, and I would hope regulators can see that.
Microsoft acquiring Bethesda fixed none of their management issues; why would this be any different? Further, Microsoft lied to EU regulators about what they'd do with the Zenimax / Bethesda acquisition.
Or maybe we should not be supporting horizontal integration of already large companies in the same industry acquiring other large companies.
The acquisition of Bethesda doesn't help Microsoft's case of horizontal integration or even their future intentions with cloud gaming with the potential integration of their existing Xbox game pass service even if they acquired Activision-Blizzard.
Seems like the UK regulators decision in that regard was the wise decision and it was the right one.
AAA games take thousands of hours of labor from huge teams to create. When you consider how much work goes into it, $70 seems like a bargain. Also, if you account for inflation these kinds of games are cheaper now than they've been for most of gaming's history.
In practice, however, many games fail to break out of super basic gameplay loops. I usually prefer cheaper indie games where I have more fun.
In the 90s I didn't have to give Rare $5 to play as oddjob, and another $5 to make heads big, and another $5 to fight slaps only, and another $5 to.....
That's the difference. Those games were $70 because the ROM chips nintendo forced you to use were basically unavailable at sufficient quantities. Playstation games were cheaper despite being able to use literally 10x the amount of assets.
The only people forcing AAA studios to add a billion polygons to every stick are themselves. They haven't tried anything different, so of course they think it's the only option. Meanwhile billions of dollars a year go to people who spent $10 on an asset in the unity store to back up a game that actually is interesting.
Actually, even worse, they often AREN'T wasting millions on assets. Grand Turismo 7 has plenty of cars that are just copy/pasted from the previous release.
Its noteworthy that the employee strikes mostly stopped after the acquisition was announced - seems they believed like I do that Microsoft would have cleaned things up.
>the CEO (Bobby Kotick) was accused of permitting workplace sexual harassment and employees at the company were on the verge of mutiny.
>Microsoft received 721 employee complaints of discrimination and harassment in the U.S. between 2019 and 2021, and Microsoft investigators found most allegations to be "unsubstantiated".
Excluding the 2022-23 complaints, I'm just wondering which company do you think is under more "chaos" and on the verge of "mutiny" right now?
The trending story on the Microsoft gaming division side is how badly Xbox is doing. I don't think Microsoft is doing anyone a favor by acquiring gaming companies at this point. It's evident that Microsoft is where game development studios go to die.
Bethesda's acquisition is extremely demoralizing due to this. I hope Starfield succeeds as it's my most anticipated game of all time.
Activision-Blizzard was in total corporate chaos before the deal was announced, the CEO (Bobby Kotick) was accused of permitting workplace sexual harassment and employees at the company were on the verge of mutiny. They were also seen as a stagnant publisher that only cared about its billion dollar franchises (Call of Duty and Candy Crush) while letting its other IPs like StarCraft and World of Warcraft rot and turning the beloved Diablo into a cash-grab pay-to-win mobile game. The Microsoft acquisition would have likely breathed some new life into the company and allowed corporate to clean up shop. This will probably lead to Activision-Blizzard continuing on its previous, doomed trajectory that it was on back in 2021.