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Whichever way Microsoft’s $69 billion acquisition goes, there will be lessons about what the FTC and regulators around the world are looking at when it comes to these types of transactions. This is a huge litmus test for the video game industry. — Kevin Hitt
Late Tuesday, a U.S. District Court judge in San Francisco granted a Federal Trade Commission request of a preliminary injunction to temporarily block Microsoft’s $69 billion dollar acquisition of video game giant and esports competition provider Activision Blizzard. The three parties are scheduled to meet in court June 22-23 to determine whether the injunction should remain until the FTC’s antitrust lawsuit against the acquisition concludes. Without the interference from the FTC, Microsoft could have closed the deal as early as this Friday.
This move is an extension of the FTC’s antitrust concerns issued on Dec. 8, when it stated that “the Proposed Acquisition would continue Microsoft’s pattern of taking control of valuable gaming content. With control of Activision’s content, Microsoft would have the ability and increased incentive to withhold or degrade Activision’s content in ways that substantially lessen competition — including competition on product quality, price, and innovation.”
Both Microsoft and Activision agree that the acceleration of the legal process benefits all involved.
However, the FTC could still be successful in torpedoing the deal, meaning the two continue as separate entities. And if the deal is blocked, expect some fallout that could affect stockholders of Activision Blizzard as well as those that may be looking to acquire the video game company after a failed attempt by Microsoft.
“Activision is of course the desired target, but there are other places Microsoft can take its multibillion war chest to,” Midia Research’s Karol Severin told GamesIndustry.biz. “If this doesn’t go through, I’d expect for Microsoft to continue on its acquisition journey with other targets.”
What would be the immediate effects of a failed transaction? For starters:
- Activision Blizzard would receive $3 billion in a “breakup” fee, which Activision CEO Bobby Kotick confirmed with CNBC last April.
- Activision Blizzard would technically be back on the market and might be had at a lower price if the failed acquisition affects the stock price in a significant negative way. Note: The release of Diablo IV has helped with the stock price in the past week, seeing a gain of around $2 a share, but a failed acquisition could see a drop.
- Microsoft may have other acquisition targets in mind as it seeks more studios to bolster the flow of games for Xbox Game Pass.
We’ll update you on the outcome of next week’s meeting between Activision Blizzard, Microsoft and the FTC. — Kevin Hitt
The final Major in Counter-Strike: Global Offensive’s esports history wrapped up last month with the Blast.tv Paris Major, and it featured several key media valuations for the sponsors of the event, Shikenso Analytics Director of Sales and Marketing Benedikt Becker and Senior Marketing Manager Karsten Schonauer tell SBJ.
Four key takeaways:
- The media value for sponsors of the event was extraordinarily high: For the sponsors, the Major generated 32.5 million euros ($32.5 million) in total media value, per Shikenso’s numbers. The media value figure includes the main broadcast and co-streams of the event. The figures are based on sizes of logos displayed and how long they’re onscreen. “This was the biggest CS:GO event in terms of media value that we’ve ever tracked,” Becker tells SBJ.
- Blast.tv excelled at working in liquor sponsors: France’s “Loi Evin,” or Evin’s Law, largely prohibits alcohol sponsors, so it was a surprise how may liquor brands appeared onscreen. Ballantines, Absolut, and Jameson, all brands of the Pernod Ricard group, were featured across the broadcast’s non-arena group stage. Schonauer notes that the liquor brands weren’t present in the Accor arena. “Apparently, [the liquor ads] were also not displayed throughout the entire event on the French stream,” Schonauer said. “… From our knowledge, they did a great job and didn’t break any laws.”
- French language viewership trailed other countries: One of the more surprising outcomes was where viewers were tuning in from. Europe and the United States dominated the viewership, but in the European category, France came in eighth. While France does not have as historic a Counter-Strike scene as Brazil, Denmark, Ukraine, and Sweden, a French team did win. “If you drill down into the countries, maybe some people would expect to see France in the top three or top five,” Becker tells SBJ. “When we checked the geodistribution, France only made it to position eight.”
- The age of the viewer was low for an older esport: CS:GO typically draws an older audience, as it’s been around for two decades. However, the average age of the Major’s viewership was younger than another international event happening at the same time: the League of Legends Midseason Invitational. The Blast Major viewers’ median age was 19.77 years old, whereas MSI’s was 20.25. While that may be a relatively insignificant gap, it’s still surprising given CS:GO’s longevity. One possible explanation: As Counter-Strike fans age, they’re introducing the game to their kids. Another is that the last CS:GO Major drew in younger fans that otherwise wouldn’t have watched.
While Blast’s viewership numbers weren’t quite as high as it hoped before the Major, several factors were at play. First, the Major was full of upsets, and many of CS:GO’s most popular teams were knocked out early. Second, MSI was also the weekend of the finals, dividing the relatively small crowd that watches all esports, not just their favorite games. — Hunter Cooke
- In a statistical aberration, the Imperial’s group stage and semifinals at the Blast Spring Finals drew more viewers than the grand finals, thanks in part to the Brazilian team’s passionate home following, writes SBJ’s Hunter Cooke.
- Team Vitality got a two-year sponsorship from Kia for its League of Legends Championship (LEC) and Ligue Française League of Legends (LFL) teams.
- PlayerUnknown’s Battlegrounds publisher Krafton named media firm ONE Esports as the official production and distribution company for PUBG esports, per Esports Insider.