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Microsoft recently announced that it was acquiring the company Activision Blizzard for nearly 70 billion dollars. Upon this news, Sony's share price took a hit. The reason for this is because Microsoft owns gaming console Xbox while Sony owns rival console PlayStation. It seems that investors believe that Microsoft acquiring Activision Blizzard could be bad for PlayStation sales which is a huge part of Sony's overall business but is this actually true?
For Microsoft's acquire of Activision Blizzard to actually go through, Microsoft will need the support of lawmakers. Well, the first question that lawmakers are going to ask Microsoft is if they are going to make Activision Blizzard games exclusively for Xbox. If this happens, Microsoft has two choices here. They can say that they are going to make their games Xbox exclusive which gives lawmakers a reason to cancel the deal or they can say that they won't which means that Sony won't be affected at all. I don't see a way where Microsoft can make all of Activision Blizzard games Xbox only without lawmakers stopping the deal from happening. I believe that the Activision Blizzard Microsoft deal either won't happen or that it won't affect Sony's business at all.
This is why I think Sony's shares shouldn't have fallen at all. I do not currently have any Sony shares, but if I did, I would not be worried about my position at all based off of this news alone. I don't believe that this will have any effect on Sony at all.
Sony is currently down 10% over the last 5 days and is trading at around 17 times earnings. The stock has seen tremendous growth over the last 5 years as it is currently up over 272% over that time.
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