Microsoft Says It Wants To Launch App Store Rival

(Photo Credit: Mack Male/Flickr)
(Photo Credit: Mack Male/Flickr)

Sign up for smart news, insights, and analysis on the biggest financial stories of the day.

As if Microsoft weren’t already all up in Google’s grill with its gussied-up new Chat-GPT-powered Bing, now it wants to make an app store too.

Xbox head Phil Spencer told the Financial Times Microsoft plans to launch an app marketplace to compete with Apple and Google as soon as next year, so long as antitrust authorities wave through its proposed acquisition of game maker Activision Blizzard.

Press F To Persuade Regulators

Xbox’s owner announced its intention to buy Activision Blizzard for $69 billion in January 2022 and if it goes through it will be the biggest deal in video game history. But it’s faced some full-throated objections from Xbox’s rival PlayStation. The fear is that ownership of game titles means Microsoft could potentially make them Xbox exclusive, and execs at both companies have publicly bickered over whether Microsoft could seal PlayStation gamers off from wildly popular games like Call of Duty.

Microsoft has already run into some sticky patches with regulators. The UK Competition and Markets Authority said last month the deal raises concerns, and the company has been trying to convince the EU of the deal’s soundness by notching licensing deals with competitors (though not PlayStation).

Spencer’s comments about launching a Microsoft app store are not entirely out of the blue as the company started laying the groundwork in October, but the timing is important:

  • The new EU Digital Markets Act is expected to come into force in March 2024, and may compel Apple and Google to allow access to each others’ app stores on their devices. For Apple especially, that’s a big hole being blown in the side of its walled garden.
  • Regulators in the EU have previously targeted Apple and Google’s control of their app stores with antitrust investigations, so Spencer’s comments seem geared towards portraying Microsoft as a competitive force to challenge the Gapple duopoly.

Candy Crushing It: Microsoft opening up its own app store for mobile games would come with some distinct advantages. The Activision Blizzard deal would bring mobile game maker King, which makes the era-defining phone game Candy Crush, under Microsoft’s umbrella. Plus a bespoke app store would mean being able to side-step the in-app payment taxes both Apple and Google impose.