4 ms·

The CMAs rationale is definitely not bizarre and is in line with how UK regulators operate. They tend to look far further into the future and are very much ris

The CMAs rationale is definitely not bizarre and is in line with how UK regulators operate. They tend to look far further into the future and are very much risk averse since they know that their powers are diminished when it comes to managing monopolies than preventing them emerging in the first place. Yes Cloud Gaming and GAAS is very much a meme still but what about 10 or 20 years down the line? Microsoft currently owns 70% of that market through the Xbox Pass. They are also the 2nd largest CSP which means they have the tech and infrastructure to deliver these services anywhere without being dependent on any one. With this deal they’ll also become true 3rd largest publisher and by sheer IP clout possibly even the biggest. The argument that the CMA makes is basically that they already have a massive first mover advantage and unlikes the likes of Sony, Valve and Epic they also have their own cloud infrastructure to deliver these services without having to make deals with anyone else. If they’ll also have a massive library of IP and titles that would give them even a larger advantage over other competitors. The logic behind the CMA’s decision is that this would give Microsoft a natural monopoly in cloud gaming which is hard to argue against. Arguing that it might not be that important is possible but it’s an argument that is very hard to actually back up with any substance since it’s all hypothetical.

etempleton 3y ago
Sony has their own cloud infrastructure. They were incredibly early and bought the two largest startups in the space—Onlive and Gaikai. Sony could compete in the space, but their subscription is unappealing to consumers because it costs more and offers less. Google has their own infrastructure and Nvidia has their own as well. I assume Amazon has their own for Luna as well. And let’s not kid ourselves, no one is subscribing to Gamepass for cloud streaming. It just happens to be bundled in, so the argument that they have a monopoly is a bit of a farce.
- dogma1138 3y ago
  Sony doesn’t have anything close to the scale of Azure and they don’t have the rest of the business model as a backstop to cover the cost of their gaming services. Google doesn’t have a major gaming brand like Xbox and doesn’t own any publishers - Microsoft has Microsoft Studios and Zenimax already. NVIDIA same thing they have the hardware business on their side but they don’t have a cloud like Azure, GCP or AWS nor do they have gaming IP in their pocket. Again the issue is you are looking at this problem from the perspective of today and by taking into account only individual elements. What the CMA is looking at is Xbox Brand + 70% of the current market + 2nd largest CSP with datacenters all over the globe and the ability to share the cost across other profitable offerings + Being the 3rd largest publisher and owning a fuck ton of gaming IP. Now extrapolate 5, 10 and 20 years down from that staring point. And remember you can always make an argument what if Google or NVIDIA invest every last cent they have to give Microsoft a run for their money but you can also make a counter argument what if Microsoft does the same. In that case Microsoft still is in a far better position because of their current position in the market. But when you extrapolate more realistically based on existing business models and ventures as well as the actual cost of developing these services further Microsoft is in a very strong position already and possibly the strongest of all players. Making them even stronger is exactly what regulators like the CMA are here to prevent.
  - etempleton 3y ago
    Yes, but others could do the same and will have to do the same if they want to get in on the business. It is not some insurmountable problem if Sony, Google, or Amazon wanted to get serious about cloud gaming. Microsoft is making the investment. It might not pay off. You can’t say something might be a monopoly one day. That is ludicrous, anything COULD be a monopoly one day.
    - dogma1138 3y ago
      Yes in a complete hypothetical scenario anything could become a monopoly but those aren’t the facts we have or the reality we live in. The point that the CMA made is that the combined advantages that Microsoft has already with this acquisition will position it well ahead of the competition to the point where it will get a natural monopoly. Natural monopolies are still monopolies even if no one else right now wants to compete. This is literally what regulators like the CMA are here for.
- manuelabeledo 3y ago
  > And let’s not kid ourselves, no one is subscribing to Gamepass for cloud streaming. It just happens to be bundled in, so the argument that they have a monopoly is a bit of a farce. Ah, I remember this one. > No one likes Windows better than any other OS, it just happens to be bundled with almost 99% of the computers sold out there. > No one wants Word over Wordperfect, it just happens to be bundled in the Office suite, and that happens to be installed along Windows in many new PCs. > No one likes Internet Explorer, it has a 90% market share just because it comes bundled with Windows. And so on and so forth. Extend, embrace, extinguish.
  - smileybarry 3y ago
    "Xbox LIVE Gold" -- AKA online multiplayer on Xbox consoles which most users buy ever since the Xbox 360 -- is $10. Xbox Game Pass is $10. Xbox Game Pass Ultimate -- which includes both -- is $15. That's the tier that also has cloud gaming. Not only is it $20 vs $15, I doubt the account system would let you subscribe to both separately instead of Ultimate. In addition, consider that Ultimate is available anywhere both Game Pass and "Gold" are available, even where cloud gaming is not. I'm subscribed to Xbox Game Pass Ultimate in Israel, except cloud gaming is not offered here (and not even as "ping may be higher than optimal", it's not even in the UI unless I VPN). If someone's counting Ultimate subscriptions as "cloud gaming subscriptions", they would be heavily inflated from "cheaper bundle" users and users from countries where cloud gaming isn't even available.
    - manuelabeledo 3y ago
      > If someone's counting Ultimate subscriptions as "cloud gaming subscriptions", they would be heavily inflated from "cheaper bundle" users and users from countries where cloud gaming isn't even available. The report states that Xcloud is available in a handful of countries, and compares it to its rivals, but the point they make is about available content, which concerns the acquisition. In other words, even if Microsoft accounted for 60 or 50% of the global cloud gaming numbers, CMA foresees a scenario where they use an extremely popular franchise to increase the value of their offering, while decreasing the attractiveness of their competitors. They also back it with some numbers that suggest that CoD could drive platform adoption up. > Our survey asked CoD gamers on PlayStation to think about the time when they bought their most recent PlayStation. The survey asked what they would have done if the most recent CoD game they owned at that time had not been available on PlayStation, but had been available on Xbox and PC. > Results indicated that 24% of respondents would have bought an Xbox, a PC, or no gaming device at all instead of a PlayStation.

etempleton 3y ago

Sony has their own cloud infrastructure. They were incredibly early and bought the two largest startups in the space—Onlive and Gaikai. Sony could compete in the space, but their subscription is unappealing to consumers because it costs more and offers less. Google has their own infrastructure and Nvidia has their own as well. I assume Amazon has their own for Luna as well. And let’s not kid ourselves, no one is subscribing to Gamepass for cloud streaming. It just happens to be bundled in, so the argument that they have a monopoly is a bit of a farce.

dogma1138 3y ago
Sony doesn’t have anything close to the scale of Azure and they don’t have the rest of the business model as a backstop to cover the cost of their gaming services. Google doesn’t have a major gaming brand like Xbox and doesn’t own any publishers - Microsoft has Microsoft Studios and Zenimax already. NVIDIA same thing they have the hardware business on their side but they don’t have a cloud like Azure, GCP or AWS nor do they have gaming IP in their pocket. Again the issue is you are looking at this problem from the perspective of today and by taking into account only individual elements. What the CMA is looking at is Xbox Brand + 70% of the current market + 2nd largest CSP with datacenters all over the globe and the ability to share the cost across other profitable offerings + Being the 3rd largest publisher and owning a fuck ton of gaming IP. Now extrapolate 5, 10 and 20 years down from that staring point. And remember you can always make an argument what if Google or NVIDIA invest every last cent they have to give Microsoft a run for their money but you can also make a counter argument what if Microsoft does the same. In that case Microsoft still is in a far better position because of their current position in the market. But when you extrapolate more realistically based on existing business models and ventures as well as the actual cost of developing these services further Microsoft is in a very strong position already and possibly the strongest of all players. Making them even stronger is exactly what regulators like the CMA are here to prevent.
- etempleton 3y ago
  Yes, but others could do the same and will have to do the same if they want to get in on the business. It is not some insurmountable problem if Sony, Google, or Amazon wanted to get serious about cloud gaming. Microsoft is making the investment. It might not pay off. You can’t say something might be a monopoly one day. That is ludicrous, anything COULD be a monopoly one day.
  - dogma1138 3y ago
    Yes in a complete hypothetical scenario anything could become a monopoly but those aren’t the facts we have or the reality we live in. The point that the CMA made is that the combined advantages that Microsoft has already with this acquisition will position it well ahead of the competition to the point where it will get a natural monopoly. Natural monopolies are still monopolies even if no one else right now wants to compete. This is literally what regulators like the CMA are here for.
manuelabeledo 3y ago
> And let’s not kid ourselves, no one is subscribing to Gamepass for cloud streaming. It just happens to be bundled in, so the argument that they have a monopoly is a bit of a farce. Ah, I remember this one. > No one likes Windows better than any other OS, it just happens to be bundled with almost 99% of the computers sold out there. > No one wants Word over Wordperfect, it just happens to be bundled in the Office suite, and that happens to be installed along Windows in many new PCs. > No one likes Internet Explorer, it has a 90% market share just because it comes bundled with Windows. And so on and so forth. Extend, embrace, extinguish.
- smileybarry 3y ago
  "Xbox LIVE Gold" -- AKA online multiplayer on Xbox consoles which most users buy ever since the Xbox 360 -- is $10. Xbox Game Pass is $10. Xbox Game Pass Ultimate -- which includes both -- is $15. That's the tier that also has cloud gaming. Not only is it $20 vs $15, I doubt the account system would let you subscribe to both separately instead of Ultimate. In addition, consider that Ultimate is available anywhere both Game Pass and "Gold" are available, even where cloud gaming is not. I'm subscribed to Xbox Game Pass Ultimate in Israel, except cloud gaming is not offered here (and not even as "ping may be higher than optimal", it's not even in the UI unless I VPN). If someone's counting Ultimate subscriptions as "cloud gaming subscriptions", they would be heavily inflated from "cheaper bundle" users and users from countries where cloud gaming isn't even available.
  - manuelabeledo 3y ago
    > If someone's counting Ultimate subscriptions as "cloud gaming subscriptions", they would be heavily inflated from "cheaper bundle" users and users from countries where cloud gaming isn't even available. The report states that Xcloud is available in a handful of countries, and compares it to its rivals, but the point they make is about available content, which concerns the acquisition. In other words, even if Microsoft accounted for 60 or 50% of the global cloud gaming numbers, CMA foresees a scenario where they use an extremely popular franchise to increase the value of their offering, while decreasing the attractiveness of their competitors. They also back it with some numbers that suggest that CoD could drive platform adoption up. > Our survey asked CoD gamers on PlayStation to think about the time when they bought their most recent PlayStation. The survey asked what they would have done if the most recent CoD game they owned at that time had not been available on PlayStation, but had been available on Xbox and PC. > Results indicated that 24% of respondents would have bought an Xbox, a PC, or no gaming device at all instead of a PlayStation.