Motley Fool Money
One Step Closer to a $69B Deal
Wed Jul 12 2023Description
The episode covers Microsoft's acquisition of Activision, regulatory challenges for big tech companies, Mattel's movie productions based on popular toys, and challenges in the film industry. The acquisition of Activision by Microsoft raises questions about antitrust regulations and potential harm to consumers. Regulatory challenges exist for big tech companies due to their size and scale. Mattel aims to produce successful movies based on toys like Barbie, with a focus on wide audience appeal. The film industry faces challenges such as the need for originality and recognition, as well as a potential contraction in audience willingness to pay for blockbusters.
Insights
Regulators scrutinize big tech
Regulators are increasingly scrutinizing big tech companies due to their size and dominance in various industries.
Consumer perspective on Microsoft's acquisition
Microsoft's acquisition of Activision could potentially harm consumers, but it is difficult to prove from a consumer perspective.
Regulatory challenges for massive tech companies
Regulators are struggling to deal with massive technology companies due to regulations being written before Big Tech emerged.
Success factors for Mattel's movie productions
The success of future Mattel productions will depend on how Barbie lands and the performance of the next two or three movies.
Challenges in the film industry
There may be a contraction happening in the industry, with people becoming less willing to pay for box office blockbusters.
Chapters
- Microsoft's Acquisition of Activision
- Regulatory Challenges for Big Tech
- Mattel's Movie Productions
- Challenges in the Film Industry
Microsoft's Acquisition of Activision
00:05 - 07:23
- Judge Jacqueline Scott-Quarley denied the FTC's efforts to block Microsoft's $75 billion acquisition of Activision.
- The judge's decision raised questions about the basis for an antitrust hearing between non-competitors Microsoft and Activision.
- Regulators are increasingly scrutinizing big tech companies due to their size and dominance in various industries.
- Microsoft's acquisition of Activision could potentially harm consumers, but it is difficult to prove from a consumer perspective.
- The laws as they currently stand in the United States do not apply to this particular deal.
- Microsoft made commitments to increase consumer access to Activision content, including keeping Call of Duty on PlayStation for 10 years and bringing Call of Duty to Nintendo Switch.
- Some Activision shareholders are rooting against the deal and would prefer the company remain standalone, possibly due to a $3 billion breakup fee if the deal falls through.
Regulatory Challenges for Big Tech
06:53 - 14:06
- Regulators are struggling to deal with massive technology companies due to regulations being written before Big Tech emerged.
- The scale of these tech companies poses a challenge for antitrust regulations.
- US and UK regulators still need to weigh in on the Broadcom-VMware deal after EU approval.
- Since it has gone through in Europe, it is expected that US regulators will not have significant issues with the deal.
Mattel's Movie Productions
13:45 - 21:17
- Mattel is co-producing the first Barbie movie and has nearly 45 other films in development based on toys like Polypocket, Uno, Barney, and Hot Wheels.
- The success of future Mattel productions will depend on how Barbie lands and the performance of the next two or three movies.
- Mattel is aiming for wide audience appeal with a slightly more gritty and adult theme than traditional superhero franchises.
- They are drawing on talent known for being part of prestigious Hollywood groups to differentiate themselves from other large IP franchises.
- The success of these movies will also depend on their at-home streaming sales and cross-platform revenue generation.
- Toys became popular foundations for movies in the 1980s when film producers realized that merchandising was a lucrative opportunity beyond just box office sales.
- There are indications that superhero movies may be entering a sunset phase due to industry constraints and audience saturation.
- In the past, audiences have shifted away from oversaturated genres towards gritty and realistic cinema or rising popularity of television.
Challenges in the Film Industry
20:54 - 25:10
- Pixar's original animated film Elemental did not gain much traction at the box office, leading to discussions about the need for recognition from the audience before a movie is released.
- The speaker argues that Elemental was not truly original and suffered from being derivative of previous Pixar films.
- Recognition is not necessarily important for a movie to be successful; originality and execution are more crucial.
- There may be a contraction happening in the industry, with people becoming less willing to pay for box office blockbusters.
- Barbie and Chris Nolan's Oppenheimer are both releasing on July 21st, with Barbie expected to perform better at the box office due to its broader appeal across age demographics.
- The critical appeal between Barbie and Oppenheimer is uncertain, but both movies could potentially receive Oscar nominations.
- The speaker expresses excitement about attending the Barbenheimer double feature and mentions the marketing impact of Barbie.