As the never-ending saga of Microsoft’s ABK acquisition continues,Activision’s CEO, Bobby Kotick, said in a recent CNBC interview that it’s in the United Kingdom’s best interest for deals like this one to go through, as otherwise, it could risk becoming “Death Valley.”
Back in January 2022, Activision agreed to be acquired by Microsoft for almost $69 billion, however, the deal has faced continued scrutiny from major regulatory institutions around the world, one of the most prominent ones being the CMA.
The CMA (Competition and Market Authority) is the UK governmental institution tasked with making sure that the country’s economic markets remain fair and competitive, and that includes making decisions on acquisitions like this one.
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Back in September, the CMA announced that it would head into the second phase of its investigation, as it had reason to believe the acquisition could unfairly harm competitors, particularly Sony’sPlayStation. As transcribed byVGC, Kotick told CNBC that the CMA, due to its lack of knowledge of the gaming industry, wasn’t looking at the deal through the proper lens. “Over the last 10 years,” he stated, “the business has evolved to being principally on phones, and so those are much more accessible.”
Kotick expressed his belief that the video game industry is, most of all, “a free-to-play business,” where “the Japanese and Chinese companies dominate.” Kotick pointed to Sony andNintendo, to how they have huge libraries of very popular franchises. “Sony studios goes back 80 years,” he stated. “Nintendo has the very best characters that exist in video games.” He believes that the CMA is “a little bit confused” on where the primary competition in the industry currently relies, labelingTencentand ByteDance as “the best companies in the world right now.”
The CEO then referenced a quote from the UK’s chancellor of the exchequer, Jeremy Hunt, who apparently said he wanted to turn the UK into the next Silicon Valley (essentially, make it a hub for the largest tech companies). Kotick spoke on the UK’s current economic state, stating the country is facing “the real severe consequences of recession.” He argues that this deal goes beyond Sony or Microsoft, that’s it about the tech sector as a whole. “If deals like this can’t get through,” Kotick stated, “they’re not going to be Silicon Valley, they’ll be Death Valley.”
