Thanks to the measures introduced by the DMA, Microsoft should launch its own mobile application and game store in 2024, thus posing as a direct competitor to the Apple App Store and the Google Play Store. The end of monopolies?
Decidedly, Microsoft does not stop! After having launched an aggressive offensive on the search engine sector with its chatbot in Bing and on that of office suites with Microsoft Copilot, the digital giant is attacking the mobile games market! Indeed, Phil Spencer, the head of Xbox Game Studiosconfirmed to FinancialTimes Microsoft’s desire to open its own application store dedicated to games by 2024 in a market hitherto controlled by Google with the Play Store and Apple with the App Store. To succeed in establishing itself on smartphones, the Redmond firm is counting on the acquisition of Activision-Blizzard but also on the entry into force in March 2024 of the Digital Markets Act – the famous DMA, see our article –, legislation which must regulate the digital markets by limiting the abuses of large American groups such as Apple, Meta, Google and Amazon.
Indeed, the law signed by the Commission and the European Parliament plans to put an end to the de facto monopolies of mobile application stores for Android and iOS by obliging Google and Apple to offer an alternative to their own solutions on their devices. Nothing insurmountable for the Mountain View firm, Android being already open to alternative application stores from manufacturers and other players (Amazon Appstore, Galaxy Store, Mi Store, etc.) while allowing users to install on their devices – smartphones and tablets – apps and games not from its Play Store, using ready-to-use installation files in the form of APKs (see our practical sheet). On the other hand, it is quite different for Apple, which has a monopoly on iPhones and iPads, the Apple brand retaining full control of its ecosystem, including for mobile applications, only available on its App Store.
Xbox Store: an application store dedicated to games
The project for an application store had already been mentioned in October 2022 via a company document. “We want to be able to bring Xbox and content from our third-party partners to any screen where someone wants to play. Today we can’t do that on mobile devices, but we want to build a world that we believe will come when those devices are open.” explains Phil Spencer to the Financial Times. However, with Apple, each game in Microsoft’s catalog must be available on the App Store, which makes it difficult for Microsoft to offer its catalog of games within the same library and as a subscription, via the Xbox Game pass.
If Microsoft advances the date of 2024, it is because the project is certainly well advanced in its development. The company intends to rely on the flagship licenses of Activision-Blizzard-King, such as call of duty And Candy Crush Saga, but also on third-party developers to fill its store with mobile video games. Already in October 2022, she explained that“Putting consumers away from the Google Play Store and the App Store on mobile devices will require a major shift in consumer behavior. Microsoft hopes that by providing well-known and popular content, gamers will be more inclined to try something again”, as reported The Verge.
Xbox Store: a project linked to the takeover of Activision-Blizzard
Microsoft’s project will only be possible if the takeover of Activision-Blizzard – for the modest sum of $68.7 billion – obtains the green lights from the various competition regulatory authorities (American, European, British, etc. ). Whether, a priori, Europe seems rather in agreement, it is far from being won on the side of the United States, where the Federal Trade Commission (FTC) filed a lawsuit to block the operation in 2022 and is still examining the related documents to redemptions. Finally, the Redmond firm must also convince the British CMA. And for that, it intends to use DMA to its advantage, qualified as“huge opportunity” and its future application store.
Indeed, the development of an Xbox Store could plead in favor of Microsoft for the validation of the acquisition, since it would constitute an opportunity to create new competition for the App Store and the Play Store. In particular, this would allow users to download applications without going through the App Store – and therefore without paying the 15-30% commission on in-app purchases – which could affect Apple’s finances.