We’re about to get started with Activision Blizzard CEO Bobby Kotick in around 10 minutes. We’re expecting that Dr. Bailey’s testimony will resume after Kotick, with questions from the FTC.
Microsoft CEO Satya Nadella will appear in the afternoon, likely at around 1:30PM PT / 4:30PM ET. We’ll also hear from Nvidia’s Jeff Fisher briefly and Microsoft is also calling Dr. Dennis Carlton, another economics expert.
FTC v. Microsoft day three was all about Sony’s objection to the Activision Blizzard deal, its bet against Game Pass, and a cloudy future.
This is the big one. Activision CEO Bobby Kotick will take the stand this morning, followed by Microsoft CEO Satya Nadella at around 1:30PM PT / 4:30PM ET.
We’ll also hear from Nvidia’s Jeff Fisher briefly and Microsoft is also calling Dr. Dennis Carlton, another economics expert, to pick holes in Dr. Lee’s report.
Day four begins at 8:30AM PT / 11:30AM ET, and we’ll be following along live right here.
That’s it for day 3 of FTC v. Microsoft. Activision CEO Bobby Kotick will testify in the morning tomorrow at 8:30AM PT, after which we’ll resume Dr. Bailey’s testimony. Microsoft CEO Satya Nadella will testify at around 1:30PM PT too.
Let’s recap Nvidia’s Phil Eisler:
• Activision games were available on GeForce Now beta and Call of Duty was one of the most popular
• Nvidia is understandably happy with its Microsoft agreement
Let’s recap Dr. Bailey:
• Dr. Bailey claims Call of Duty isn’t essential
• Dr. Bailey has analyzed telemetry data from Xbox and PlayStation
• Call of Duty isn’t uniquely important, apparently
Don’t forget to check out our recap of PlayStation chief Jim Ryan’s testimony and the FTC’s economic expert, Dr. Robin Lee.
Big day ahead tomorrow with live testimony from Microsoft and Activision CEOs. We’ll be back here at 8:30AM PT / 11:30AM ET.
Microsoft wants to paint Call of Duty as not all that important, because gamers play plenty of other games. Dr. Bailey says there are a “good percentage of gamers” who are playing more than 10 franchises on PlayStation.
Dr. Bailey also looked at whether Call of Duty players spend more money, something that came up in Dr. Lee’s report. We only have an audio feed here so it’s difficult to know what data is being show, but there are comparisons between Call of Duty and God of War Ragnarök. Both games have been bundled with consoles.
Dr. Bailey argues that how often a game is played on a first day is a proxy to how important the game is, but she’s not aware of different game bundles in different US states. That could be a hole in the telemetry analysis here.
“Call of Duty is an important game and it’s a popular game, but there’s nothing to suggest it’s... uniquely important,” says Dr. Bailey. She’s also looked at the Nintendo Switch being successful without Call of Duty. Switch share has grown 35 percent without Call of Duty, Dr. Bailey says.
Dr. Bailey has been given access to key telemetry data from both PlayStation and Xbox for Call of Duty. Microsoft argues that data for market share and usage shouldn’t be limited to just the US and that it should be global. “It reinforces that nexus of competition and competitive decisions are made not global, nor local or limited to the United States,” says Dr. Bailey.
Dr. Bailey was able to analyze game time to determine if the same games are popular in the US and other parts of the world. “If you look at the most highly played games that set of games that are most highly played in the US is a very similar set the most highly played games in other countries around the world,” says Dr. Bailey.
Dr. Bailey also confirms that Dr. Lee also had access to the same telemetry data.
We’ve heard Microsoft argue that its Activision Blizzard acquisition is mainly about the opportunity in mobile. Now Dr. Bailey is being questioned about the mobile market.
“Mobile is the largest, it’s about 70 percent” of the overall $150 billion gaming market. PC gaming is around $33 billion, console gaming at $28 billion. Xbox is “less than half a percent of mobile gaming revenue,” says Dr. Bailey. “Activision Blizzard is also very small in mobile gaming. So combined, they’ll have 3.8 percent of mobile gaming.”
Dr. Bailey says “Call of Duty is not essential, critical, or must-have. It’s not a unicorn.”
That’s the opposite of what we heard from Dr. Lee earlier, and even Judge Corley described Call of Duty as a unicorn previously. Dr. Bailey says Dr. Lee’s markets are “too narrow” and that the merger will expand the reach of content.
Microsoft has now called Dr. Elizabeth Bailey as a witness, an economics expert at Charles River Associates. We’re going to get Dr. Bailey’s economic opinion of Microsoft’s Activision Blizzard acquisition.
Microsoft’s lawyer asks Phil Eisler, who leads the GeForce Now team at Nvidia, about its agreement earlier this year for Xbox PC games on its streaming service:
“The agreement entitles us to the content provided the transaction completes on the Activision side. We have already begun working with Microsoft to onboard their first-party titles, so we’re confident that will solve our concerns there.”
