When Microsoft announced it would spend $68.7 billion to buy Activision Blizzard to bolster its Xbox gaming division, the news came as a surprise to many. For months, the troubled publisher had been in headlines stemming from the workplace sexual harassment lawsuit filed by California’s fair employment agency in July. The bad press hit a fever pitch on November 16th after The Wall Street Journal published a report that asserted Activision CEO Bobby Kotick had not only known about many of the incidents of sexual harassment that had occured at the company but had also acted to protect those who were responsible for the abuse.

Days after that article came out, Xbox chief Phil Spencer reportedly told employees he was “distributed and deeply troubled by the horrific events and actions” that allegedly took place at Activision Blizzard and that Microsoft would re-evaluate its relationship with the publisher. It’s one day after that email that Spencer called Kotick to start the process that would end with Microsoft announcing plans to buy Activision Blizzard some two months later, according to a US Securities and Exchange Commission filing first spotted by CNBC.

Starting on page 31 of the document, Microsoft devotes nearly 10 pages detailing the timeline of its talks with Activision. According to the filing, Spencer told Kotick during their November 19th phone call that “Microsoft was interested in discussing strategic opportunities” between the two companies and asked if he had time to talk to Microsoft CEO Satya Nadella the following day. That Saturday, November 20th, Nadella made it clear Microsoft hoped to purchase the publisher, stating the company was “interested in exploring a strategic combination with Activision Blizzard.”

It turns out the quick pace at which the talks moved was mainly due to all the other companies interested in buying up Activision Blizzard after its stock dived in November. At least four other companies contacted the publisher about a possible acquisition. None of them are named in the SEC filing. However, one notably wanted to just buy Blizzard. Activision didn’t move forward with that option because the company’s board of directors deemed the sale would have been too difficult to pull off.

The document also details the terms of the purchase agreement. If the deal doesn’t go through due to antitrust complications, Microsoft has agreed to pay Activision Blizzard a termination fee of up $3 billion. A few years ago, that’s a possibility Microsoft probably wouldn’t have had to worry about too much, but 2022 finds the company in a very different regulatory environment. At the start of the month, NVIDIA abandoned a $40 billion bid to buy ARM after the Federal Trade Commission sued to block the purchase. President Biden appointed Lina Khan, the Commission’s current chair, to the position on the strength of her experience in antitrust law. When the NVIDIA-ARM deal fell through, the agency specifically noted it was "significant" because it "represents the first abandonment of a litigated vertical merger in many years." 

Spotify announced today that it is acquiring two major podcast ad tech firms, Chartable and Podsights, in a move to expand its offerings to advertisers. Both companies offer popular tools that help brands and agencies better understand the effectiveness of their podcast ads.

In a blog post announcing the acquisitions, Spotify laid out how both companies will expand its ad platform. With Podsights, advertisers will be able to see more detailed data on who clicked on an ad and what actions they took after the fact (i.e. if they purchased the actual product). “As part of Spotify, Podsights will be able to utilize Spotify’s technology and intelligence to bring more accurate measurement and actionable insights to podcast advertisers around the world,” wrote Spotify in its post.

The Chartable acquisition seems more geared towards podcast ads about podcasts. It's two promotional tools — SmartLinks and SmartPromos — will now be available to podcasters on Spotify. SmartPromos allows podcasters to see which ads are resulting in the most downloads and essentially measure the success of their ad campaigns. SmartLinks, according to Chartable’s website, are “shareable, trackable URLs that automatically route listeners to their podcasts”. The tool allows podcasters to track both clicks and downloads.

Spotify has invested heavily in expanding its podcast offerings over the past couple of years; both by locking high-profile creators into exclusivity deals and offering podcast advertisers more bang for their buck with more detailed analytics. The Chartable acquisition in particular will build on Megaphone’s offerings; another ad tech acquisition Spotify made in 2020.

These two acquisitions are likely to sweeten the pot for both advertisers and professional podcasters looking to join Spotify. If you’ve felt that podcast ads have become more numerous over the past couple of years or so, you’re not imagining things: Spotify has expanded its ad setup with in-app ads and pre-recorded ad slots that are tailored to your listening habits. "This latest deal seems positioned to make the platform a more attractive option for brands and advertisers, and to entice podcasters without a network or salespeople of their own into Spotify's walled garden."

NVIDIA's has reportedly abandoned its plans to purchase ARM, the UK-based business that licenses chip technology used in most smartphones. According to The Information, the deal collapsed on Monday, a year and a half after NVIDIA announced that it's purchasing the Softbank-owned chip business for cash and stock then valued at $40 billion. Based on NVIDIA's current stock prices, the deal would've been worth over $60 billion if it had gone through today. 

The planned takeover, however, was met with opposition from the start. ARM customers Qualcomm and Microsoft objected to the deal, raising concerns that NVIDIA might prevent ARM from licensing its chip designs. The massive acquisition, which would've been the largest in the chip sector, was also intensely scrutinized by regulators. UK's Competition & Markets Authority investigated it twice over its impact product prices and quality, as well as on its implications on national security. 

In the US, the Federal Trade Commission sued to block the purchase over concerns that it would stifle competition for multiple technologies. Previous reports said NVIDIA has been preparing to walk away from the deal since early January, seeing as it has made little progress on convincing regulators to approve the purchase. 

As The New York Times notes, NVIDIA repeatedly told authorities that it will keep ARM's business model and even proposed to set up a separate licensing entity for its chip designs. It also said that it will license any ARM-based IP that it develops to all companies without discrimination. "There is no evidence that a combined NVIDIA and ARM would have either the ability or the incentive to harm competition," its lawyers said in a response to FTC's lawsuit. 

ARM-owner Softbank will get a break fee of up to $1.25 billion as a result of the failed purchase, the sources said. Its Japanese parent company is also expected to take ARM public before the year ends, though it will likely have a tough time matching NVIDIA's offer.

Microsoft was most likely ready for rigorous anti-trust scrutiny around the world when it decided to purchase Activision Blizzard for $68.7 billion. The deal is the tech giant's biggest yet, and it's also set to become the largest all-cash acquisition ever. In the US, the proposed acquisition will be reviewed the Federal Trade Commission instead of the Justice Department, according to Bloomberg. The two agencies are in charge of investigating mergers in the country and typically decide between themselves which one will take charge of a case. 

FTC's investigation will reportedly take a close look at how Microsoft's ownership of Activision could harm rivals by limiting access to the developer's biggest games. Activision owns hugely popular IPs, including Call of Duty, World of Warcraft and Candy Crush. It's unclear if Microsoft has plans to release titles exclusive to Xbox and Window PCs in the future, but it's worth noting Sony is still ahead of Microsoft in terms of gaming hardware sales and that a large chunk of Activision's revenue comes from PlayStation gamers.

Microsoft expects to close the acquisition by June 2023, and it's probably not going to be easy for the company. As Bloomberg notes, the FTC vowed to adopt a more aggressive approach towards investigating mergers and acquisitions last year under new chairperson Lina Khan. In December, the FTC sued to block NVIDIA's $40 billion purchase of ARM over concerns that the deal would stifle competition for various technologies, such as those for data centers and car computers. 

A more recent Bloomberg report said NVIDIA is making preparations to walk away from the deal and that current ARM-owner SoftBank is looking to take the company public if the acquisition falls through. Still, the Microsoft seems to be confident that the acquisition will take place — Reuters says the tech giant committed to paying a $3 billion break fee if the deal fails to go through. 

After investing $4.5 billion in India's largest carrier Jio, Google is now putting up to $1 billion in Airtel, the second largest mobile operator, Airtel announced. The partnership is focusing on "affordable access to smartphones" and is part of Google's promised $10 billion investment in the country. "Our commercial and equity investment in Airtel is a continuation of our Google for India Digitization Fund's efforts to increase access to smartphones," Google CEO Sundar Pichai said in a statement. 

The deal includes a $700 million investment to acquire a 1.28 percent ownership in Airtel, with another $300 million earmarked for potential commercial agreements. Specifically, Airtel and Google will work to expand on Airtel's Android device lineup via "innovative affordability programs." The companies didn't specify what those programs would entail, however.

Airtel also said that it would look at "larger strategic goals" with Google around 5G network standards, cloud ecosystems and more. "With our future ready network, digital platforms, last mile distribution and payments ecosystem, we look forward to working closely with Google to increase the depth and breadth of India’s digital ecosystem," said Airtel chairman Sunil Bharti Mittal. 

Google previously collaborated with Jio on the low-cost $87 JioPhone Next smartphone that went on sale on November 4th price following a delay due to the global chip shortage. Jio has also received investment from Facebook and other companies. 

With a huge number of potential internet users, Alphabet, Facebook parent Meta and others have looked to India to boost growth. Both tech giants have worked to bring internet connectivity to India, Alphabet with Project Loon and Meta via Free Basics, which was later banned in India. 

NVIDIA has reportedly made little to no progress in gaining regulatory approval for its $40 billion purchase of ARM and is privately preparing to abandon the deal, according to Bloomberg's sources. Meanwhile, current ARM owner SoftBank is reportedly advancing a program to take ARM public as an alternative to the acquisition, said another person familiar with the matter.

NVIDIA announced the deal in September 2020, with CEO Jensen Huang proclaiming it would "create a company fabulously positioned for the age of AI." ARM's designs are used under license almost universally in smartphones and other mobile devices by companies like Apple, Qualcomm, Microsoft, Samsung, Intel and Amazon. 

A backlash began soon after the announcement. The UK, where ARM is based, launched an antitrust investigation into the acquisition in January 2021, and another security probe last November. In the US, the FTC recently sued to block the purchase over concerns it would "stifle" competition in industries like data centers and car manufacturing. China would also reportedly block the transaction if other regulators don't, Bloomberg's sources say. 

We continue to hold the views expressed in detail in our latest regulatory filings — that this transaction provides an opportunity to accelerate Arm and boost competition and innovation.

Companies like Intel, Amazon and Microsoft have reportedly given regulators enough information to kill the deal, the sources say. They previously argued that NVIDIA can't preserve ARM's independence because it's an ARM client itself. As such, it could also potentially become both a supplier and competitor to ARM licensees. 

Despite the stiff headwinds, both companies maintain that they're still pushing forward. "We continue to hold the views... that this transaction provides an opportunity to accelerate ARM and boost competition and innovation," NVIDIA spokesman Bob Sherbin told Bloomberg. "We remain hopeful that the transaction will be approved," a SoftBank spokesperson added in a statement.

Despite the latter comment, factions at Softbank are reportedly pushing for an ARM IPO as an alternative to the acquisition, particularly while the semiconductor industry is so hot. Others in the company want to continue pursuing the transaction given that NVIDIA's stock price has nearly doubled since it was announced, effectively increasing the transaction price.

The initial agreement expires on September 13th, 2022, but will automatically renew if approvals take longer. NVIDIA predicted that the transaction would close in approximately 18 months — a deadline that now seems unrealistic.

Google has filed a motion to dismiss most of an ad tech-focused antitrust lawsuit brought forward by a group of state attorneys general. It has requested that a federal court dismiss four of the six charges with prejudice, which would prevent them from being brought back to the same court.

"The complaint misrepresents our business, products and motives, and we are moving to dismiss it based on its failure to offer plausible antitrust claims," Adam Cohen, Google's director of economic policy, wrote in a blog post. The company says the plaintiffs failed to provide evidence of wrongdoing for several of their allegations and that much of the suit "is based on outdated information that bears no correlation to our current products or business in this dynamic industry (and in any event never amounted to a violation of antitrust laws)."

The AGs, who are led by Texas AG Ken Paxton, claimed Google abused its power to shore up its position in the online ads market. They said the company agreed a "sweetheart deal" in 2018 that gave Facebook parent Meta a boost in ad header bidding (a type of tech allows publishers to solicit bids from multiple ad exchanges simultaneously) in exchange for support for Google's Open Bidding method of selling ads.

Google said the deal was above board and that it wasn't a secret, as Facebook Audience Network (FAN) was one of several partners for its Open Bidding program. Cohen said the deal "does not provide FAN with an advantage in the Open Bidding auction. FAN competes in the auction just like other bidders: FAN must make the highest bid to win a given impression, period. If another eligible network or exchange bids higher, they win the auction."

The AGs also alleged that Google harnessed at least three programs to manipulate ad auctions. The aim, according to the states, was to push publishers and advertisers into using the company's own tools.

"State Plaintiffs respond to Google’s success by seeking to compel Google to share with its competitors the fruits of its investments and innovation," Google wrote in its filing. "They criticize Google for not designing its products to better suit its rivals’ needs and for making improvements to those products that leave its competitors too far behind. They see the 'solution' to Google’s success as holding Google back, rather than letting market forces urge its competitors forward."

As Reuters notes, the two other charges in the suit are based on state law and were stayed in September. Although Google hasn't asked for those to be dismissed, it reserved the right to make that request at a later date.

It was cute at first. When Xbox head Phil Spencer took the stage at E3 2018 and announced the acquisition of five notable studios – Undead Labs, Playground Games, Ninja Theory, Compulsion Games and The Initiative – the air inside the Microsoft Theater turned electric. It felt like the company was righting a wrong in its business plan and finally building an internal roster of exciting games that it could offer exclusively on Xbox platforms. You know, a few friends to keep Master Chief company.

Today’s announcement that Microsoft is buying Activision Blizzard, the largest third-party publisher in the video game industry, doesn’t feel as harmless. Four years on and numerous acquisitions later, the Activision Blizzard deal feels like an extreme escalation of Microsoft’s plans, and it could mark a turning point in the video game industry as a whole, with negative consequences for both players and developers.

So far, public reaction to the acquisition has been mixed, which makes sense for a few reasons: first, Activision Blizzard's sheer size is daunting, and this purchase represents more money and industry power than Microsoft's previous gaming acquisitions combined. Second, Activision Blizzard is currently the subject of multiple investigations into allegations of sexual harassment and gender discrimination at the studio, where CEO Bobby Kotick has been in charge and largely unchecked for the past 30 years. The Wall Street Journal is reporting that Kotick is poised to leave the company in a golden parachute once the Microsoft deal goes through.

This is the first time Microsoft has received a confused response to acquisition news, rather than outright praise, and that's because this isn't a standard transaction. It's the clearest sign yet that we're in the video game industry's era of consolidation.

Back in 2017, Microsoft was badly losing the first-party IP fight to Sony and Nintendo. By the end of that year, Xbox had shut down two of its internal studios, Lionhead and Press Play, it had killed a few hotly anticipated projects, and even with the Xbox Series X right around the corner, there wasn’t much to look forward to in the company’s software reserves. The acquisition announcement at E3 2018 was a sigh of relief for anxious Xbox fans.

By February 2019, Microsoft had 13 studios and publishing organizations under the banner of Xbox Game Studios.

Microsoft

And then in September 2020, Microsoft revealed it was buying ZeniMax Media, the parent company of Bethesda, id Software, Arkane Studios and Tango Gameworks. The gaming world generally rejoiced, but a few folks also started glancing around, suspicious. These studios were a big deal – the stewards of Fallout, Doom, Dishonored, Wolfenstein, Deathloop, Starfield and Elder Scrolls – and they were being added to Microsoft’s substantial pile of medium-sized companies, more names in a growing list. That alone was cause for pause.

For most fans, the main question was, what did the acquisition mean for games like The Elder Scrolls VI, which was part of a series that historically hit PlayStation and Xbox platforms alike? Basically, would Elder Scrolls VI come to PS4 and PS5?

Turns out, probably not.

One year after Microsoft’s purchase of Bethesda, Spencer told GQ that he believed the Xbox ecosystem was the best place for all of the franchises in the studio’s repertoire, including The Elder Scrolls VI. He all but confirmed it would be exclusive to Xbox.

“It’s not about punishing any other platform, like I fundamentally believe all of the platforms can continue to grow,” Spencer told GQ. “But in order to be on Xbox, I want us to be able to bring the full complete package of what we have. And that would be true when I think about Elder Scrolls VI. That would be true when I think about any of our franchises.”

Starfield, Bethesda’s sci-fi RPG built for the ninth console generation, will definitely be exclusive to Xbox Series X/S and PC, skipping PS5 entirely. Spencer’s comments make it clear that Xbox is eyeing exclusivity for its franchises, and after today’s $69 billion deal goes through, that’s going to include Activision Blizzard games.

Microsoft

Activision Blizzard is the largest third-party publisher in gaming, and it’s the owner of massive franchises including Call of Duty, Overwatch, Diablo, World of Warcraft, Hearthstone and Candy Crush. As a third-party studio, Activision Blizzard has been able to negotiate with the main platform holders to get its software on the consoles and devices it wants. This doesn’t always equate to same-day launches or in-game item equity, but generally speaking, this position has helped ensure Activision Blizzard games reach as many players on as many platforms as possible. Exclusivity agreements and distribution deals are the main source of competition in the industry at this point, allowing outside developers to advocate for their games without feeling beholden to any console owner in particular.

When a platform holder becomes the largest publisher in gaming, it flips the script completely. It jams the script into a shredder, burns the scraps to ash, condenses the ash into stone, and then throws that to the bottom of the Mariana Trench.

Let’s take Call of Duty, a series with predictable annual installments, for example. Over the years, Activision has shifted allegiances between Microsoft and Sony, offering early access and exclusive game modes to Xbox platforms, then PlayStation, and mixing it up along the way. Among all the backroom talks, bad blood and better offers, it’s always been up to Activision to cut the best deal for Call of Duty, console holders be damned.

After the acquisition, that negotiation looks entirely different, if it even exists at all. As the owner of Call of Duty, Microsoft can tell Sony to screw off, keeping one of the industry’s biggest franchises exclusive to Xbox platforms.

This likely won’t happen right away, but it’s certainly a possibility down the line. In his blog post about the acquisition, Xbox’s Spencer didn’t address Sony or Nintendo platforms specifically, but he alluded to the possibility of cross-platform support for Activision Blizzard’s franchises. 

“Activision Blizzard games are enjoyed on a variety of platforms and we plan to continue to support those communities moving forward,” he said, without detailing what he meant by “platforms” or “support.” Keep in mind, this was the messaging around Elder Scrolls VI at first, too.

Microsoft isn’t the only company in the midst of a studio-hoarding spree: Sony picked up its 13th internal studio, Housemarque, in June 2021, while Tencent is chugging along with ownership of Riot Games, financial stakes in a handful of massive studios, and the purchase of LittleBigPlanet 3 developer Sumo Group in July 2021. Even Valve has scooped up a handful of independent creators in recent years, including the team behind Firewatch and some members of Kerbal Space Program.

MARK RALSTON via Getty Images

Microsoft’s purchase of Activision Blizzard simply feels like the final push into a new era for the video game industry: consolidation.

While exclusivity deals may be the short-term concern, this trend has a longer and more tragic tail. It’s highly likely that there will be more acquisitions by Microsoft, Sony and other major names in gaming, and these deals and subsequent companies will only get bigger with time. With just a few massive studios controlling a huge chunk of the software pipeline, it could instill a sense of homogeneity among new titles, killing innovation as each developer attempts to conform to the corporate environment around them, actively or subconsciously.

Even with “creative freedom” built into their contracts, the acquired studios will all use the same QA process, funding arrangement, marketing plan, management structure and editing cycle; they’ll have the same bosses and face the same oversight. And when all new products are the result of a singular perspective, they’re bound to feel familiar. Stale, even. Boring.

Microsoft’s acquisition of Activision Blizzard is an escalation of the exclusivity scheme, and it represents a new way of doing business. Now and for years to come, consolidation is the name of the game.

Maybe one day we’ll get Consolidation 2: Blow It All Up And Make Everything Indie Again, but that one might have trouble finding a publisher.

Microsoft just made one of the largest-ever bids for a game studio. The company has announced plans to acquire Activision Blizzard for $95 per share, valuing the all-cash deal at an enormous $68.7 billion. The deal would make the combined entity the "third-largest" game company by revenue, according to Microsoft, and would put titles like Call of Duty and World of Warcraft under the company's wing. Microsoft plans to add Activision Blizzard games to Game Pass as part of the deal.

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AMC Networks has acquired anime distributor Sentai. Financial terms of the deal haven’t been disclosed, but the purchase includes Sentai’s Hidive streaming service. It will join AMC’s stable of “targeted” streaming platforms, which already includes services like Shudder, IFC and SundanceTV. As part of the deal, AMC has also picked up Sentai Studios, the Anime Network and the company’s extensive catalog of anime titles. Some of the projects Sentai holds the license to include K-On! from Kyoto Animation and Haikyu!! from Production IG.

The acquisition comes less than a year since Sony completed a $1.175 billion deal to buy Crunchyroll from AT&T. At the time, the company said it would work quickly to create a unified anime subscription service that would feature content from both Funimation, which Sony has owned since 2017, and Crunchyroll. If nothing else, today's deal shows just how big of a business anime has become in the west.