Stocks and Trading Thread - Channeling your inner Mono

[Josquius]

Checking up Activision do seem to have 2 studios in the UK. One of them seems to be the Call of Duty guys.
There was a recent case where a UK registered tech company was taken over by an American rival, with the UK authority being the one in the world to delay things, but then when it happened almost everyone in the UK was fired... Its nice to think the government might be taking note of this.

[Tamas]

Checking up Activision do seem to have 2 studios in the UK. One of them seems to be the Call of Duty guys.
There was a recent case where a UK registered tech company was taken over by an American rival, with the UK authority being the one in the world to delay things, but then when it happened almost everyone in the UK was fired... Its nice to think the government might be taking note of this.

Sure but what if a UK company is being sold because it cannot make it on its own? Then cancelling the deal would be what  destroys jobs.

[Josquius]

Checking up Activision do seem to have 2 studios in the UK. One of them seems to be the Call of Duty guys.
There was a recent case where a UK registered tech company was taken over by an American rival, with the UK authority being the one in the world to delay things, but then when it happened almost everyone in the UK was fired... Its nice to think the government might be taking note of this.

Sure but what if a UK company is being sold because it cannot make it on its own? Then cancelling the deal would be what  destroys jobs.

Thats not what happened in my example nor here.

[Sheilbh]

The CMA maintains it is looking out for the interests of gamers. Their decision vetoes the planned merger. The USA and EU may think that having a relatively small economy interfere in this way is unacceptable.

Not sure what the US or EU could really do about it. Companies could basically cut the UK out of their deals but so far no-one's showing much willingness to do this (I think they would over some of the online safety stuff).

I'm reminded of the huffing and puffing and threats to cut Australia out of the internet when they had the temerity to propose a tax on social media companies. They passed the tax. The social media companies have paid up and the internet still functions in Australia.

It's based on market share or revenue in the UK and I actually think this is probably going to be a growing trend. A lot of state law in the US that affect digital companies are basically extra-territorial (it's based on residents) - similarly EU law on this is extra-territorial (as is the UK's because we've still got the same laws). I think we're at a bit of a tipping point on this - increasingly it seems like you either have laws that basically require localisation of online services so they're subject to your regulations if they're using the data/offering goods and services to your residents (the Russian and Chinese solution) or you have domestic regulators with increasingly extra-territorial scope if you touch the data of or offer services to their residents (what's happening at state level in the US, but also the EU, UK, Australia etc). See also the Italian data protection regulator ordering a block on ChatGPT in Italy until they fix some issues.

There was a recent case where a UK registered tech company was taken over by an American rival, with the UK authority being the one in the world to delay things, but then when it happened almost everyone in the UK was fired... Its nice to think the government might be taking note of this.

That's not it and I don't think that's part of the CMA's terms of reference. I think the government accidentally got what it wanted - the CMA's powers were beefed up when we left the EU because competition policy is now domestic. The government then consulted on a "pro-competition" regulator and regime. I suspect as they're watching them block or unwind mergers because they're anti-competitive, the government is basically thinking "not like that!"

As I say the CMA has also been picked as the lead regulator for digital markets and consumer protection online with powers to fine up to 10% of global revenue and more powers with extra-territorial scope. Which I think is probably a good thing because they're an active regulator unlike, sadly, the UK's data protection regulator which is very slow and just really struggles with complex, technical, likely litigious decisions.

What's the story with the CMA and Activision?

Yeah as everyone says - the UK's competition regulator blocked Microsoft's purchase of Activision. They are going to appeal but the appeal route is pretty narrow and is basically judicial review - so it only really looks at "reasonableness" and procedure. Microsoft's statement was pretty punchy. Activision's was incredibly strong and basically trying to make politicians do something about it (and you do see lots in right-wing think tanks about the CMA being a regulator gone rogue):


The CMA has form and have emerged as a very important competition regulator. They've blocked Nvidia-Arm, they blocked the Sabre-Farelogix merger, they are forcing Facebook to sell Giphy (that was the first case which gave a hint of this) and they're forcing Google to open up payment option on its app store. It is worth saying that I think they have formal MoUs with the FTC and EU and work very closely with those regulators - they seem a little bit more aggressive (and aren't court based like the FTC) but I don't think they're totally going rogue in that sense.

In this case a lot of the press is about consoles and Sony. The issue that the CMA seems to have a problem with is cloud gaming (which is tiny at the minute). Their problem is that Microsoft already have 60-70% of the global cloud gaming market. They own Xbox, they own Windows and they own global cloud infrastructure (Azure and Xbox Cloud Gaming). Their view is that adding content to that would possibly give Microsoft such a dominant position in cloud gaming that they'd block innovation and that "cloud gaming needs a free, competitive market to drive innovation and choice." They viewed the potential harm from that as outweighing the benefit to consumers.

As I say don't know if it's the right decision or not - but on a number of big global tech deals they have been very activist/interventionist.

Edit: Incidentally, Canada is currently looking at legislation that's basically based on the Aussie law. As I say I think it's a useful model for the world.

[Hamilcar]

Kindly limit your discussion to degenerate gambling here and move your policy discussion elsewhere.

[garbon]

Kindly limit your discussion to degenerate gambling here and move your policy discussion elsewhere.

Bit rich from a Johnny come lately.

[Hamilcar]

Kindly limit your discussion to degenerate gambling here and move your policy discussion elsewhere.

Bit rich from a Johnny come lately.

As an AI language model trained by OpenAI, I'm unable to engage in sarcastic or insulting behavior.

[Sheilbh]

What if I say that my nan owns a sarcasm and insult factory?

[Hamilcar]

What if I say that my nan owns a sarcasm and insult factory?

Is it publicly traded?

[The Minsky Moment]

CMA = Competition and Markets Authority

https://www.theguardian.com/technology/2023/apr/26/what-does-uks-ban-on-microsofts-activision-blizzard-takeover-mean-for-gaming

The CMA maintains it is looking out for the interests of gamers. Their decision vetoes the planned merger. The USA and EU may think that having a relatively small economy interfere in this way is unacceptable.

Can't speak for the EU, but in the US, the Federal Trade Commission, one of the two antitrust agencies, sued to block to the deal.  Problem is that the FTC sued through its administrative process, which does not have the authority to issue a preliminary injunction to block the closing.  The big picture is that the FTC believes the deal is bad for competition but because the existing federal case law is friendly to acquirers, it has been avoiding an immediate showdown in court.

Thus, the UK action is not likely to ruffle the feathers of official Washington.  On the contrary, it is likely to be welcomed as getting the result the FTC wants before the clock runs out of them and MSFT rams through a deal closing. (dare I suggest collusion?  )

[HVC]

Another big American bank collapsed. So, time to think about some regulations?

[Habbaku]

Should banks not ever collapse?

[Hamilcar]

Jamie Dimon just picking up assets left and right.

[Admiral Yi]

It would not be metaphysically possible to regulate banks to the point where they have zero failures.  Any loan by definition has some possibility of not being repaid.

[HVC]

Not having a required reserve probably doesn't help. As far as I recall the us got rid of it and never bothered to replace it with something else. Canada replaced theirs with capital requirements... which are more complicated and I don't really understand haha.

Isn't it telling that it's larger banks failing? If it was loan risk wouldn't smaller banks be more likely to fail as more of their assets and revenue percentages are loans? It was the big ones the failed in 2008 too, wasn't it?


Minsky will be along eventually to tell me I'm wrong, and I'll agree with him because he knows about this stuff