• The British state was prepared to intervene—and did—in the event of what would now be called market failure. In 1795, in the wake of disruption from warfare in Grenada, the merchants and planters of Grenada and St Vincent benefited from emergency Exchequer Loans from the British state totalling £1.6 million. The state made further provision, for example in response to volcanic eruption on St Vincent in 1811 and to hurricane damage in the British Caribbean in the early 1830s.
• Other bankers appeared caught in inaction. William Alers Hankey, whose family bank was a predecessor of Royal Bank Scotland and who had become the owner of the Arcadia estate in Jamaica, agonized over his slave ownership in 1832—saying “I am an enemy to slavery in the abstract”—but could find no solution to his ownership.
• Elsewhere, the operation of distance and the abstraction of credit instruments separated British institutions from slavery. Abolitionist bankers could and did hold mortgages and other instruments secured on estates and enslaved people. Henry Alexander was a Quaker and partner in Messrs. Alexander & Co, Ipswich bankers, who unsuccessfully counterclaimed as assignee of an annuity of £200 on New Montpelier Estate in St James, Jamaica with his father Dykes Alexander junior and his uncle Samuel Alexander. Henry Alexander founded and funded the Girl’s Free School of Industry in Ipswich. When his brother Richard Dykes Alexander made some land in Ipswich available for development in the 1850s he stipulated that some of the streets should be named after leading abolitionists.
• There is little evidence of British financial institutions actively reducing their exposure to the slave economy for economic reasons. Perceptions of increased risk and decline in the value of “West India property” in the 1820s discouraged financial institutions from advancing new credit in long-established colonies such as Jamaica or St Kitts, in turn accelerating the depreciation of West India property—both the land and the enslaved people—but those very conditions made it harder to reduce old credit exposures.
• At the other end of the spectrum, in the aftermath of the abolition of the slave trade, a group of merchants and financiers based primarily in Liverpool and to an extent in Glasgow invested heavily in the new sugar frontiers of British Guiana (formed from the former Dutch colonies of Demerara, Berbice and Essequibo). John Gladstone, a director of the Royal Bank of Scotland and the father of Prime Minister W.E. Gladstone, was the most prominent of these entrepreneurial financiers, defending slavery in the face of the abolitionist assaults of the 1820s.
• In the early 1830s, as abolition became more likely, segments of the City of London mobilized to protect their interests. The argument that slavery was systemically important, and that an unmanaged collapse in the wake of abolition would jeopardize the financial system as a whole, gained traction—the “too big to fail” argument. The collapse in 1831 of the London West India merchant firm of Manning & Anderdon had shaken the banking system. Smith, Payne & Smith, a predecessor firm of the Royal Bank of Scotland, was a major creditor of Manning & Anderdon, and was rocked by its failure.
• The calls for compensated emancipation advanced by the slave owners themselves in the 1820s were taken up in the early 1830s by financiers, not only those directly exposed but also by other voices concerned with systemic stability. They argued that the state should provide funding to cushion the impact of ending of slavery to avoid a disorderly collapse of the structure of credit on which much of the slave economy depended and to which many British institutions were exposed or over-exposed.

5 more annotations...

• The CMA has spent much of its investigation trying to establish an unproven concern, unrelated to the Merger, that Microsoft has unrivalled advantages in cloud gaming. Indeed, at Phase I, the CMA’s second theory of harm was explicitly presented as “foreclosure of cloud-gaming service providers through leveraging Microsoft’s ecosystem” and it is only belatedly that the CMA has accepted that its repeated efforts to articulate a novel ‘ecosystem’ theory of harm were doomed to fail. In the Provisional Findings, the CMA accepts that any “ability on Microsoft’s part to use [its existing ‘ecosystem’] assets to foreclose rivals does not form part of this theory of harm”. 6
• The CMA’s revised theory requires, as a basic starting point, that Activision content would have been available to rival cloud gaming services absent the Merger. That is not the case today.
• The NVIDIA Agreement produces a far better outcome for NVIDIA, competition in cloud gaming and ultimately gamers, than could conceivably have occurred absent the Merger. As a result, the Merger will enhance competition in cloud gaming, not lessen it.
• When the two figures are compared, the error is obvious: on the gains side, the calculation uses a 5 year gross profit figure, on the losses side, it uses a figure for only a single year. Making a single correction for this mistake and extending the analysis to a 5-year CoD LTV reverses the results of the analysis in the Provisional Findings. The analysis now shows that there is no incentive for Microsoft to withhold CoD.
• The nascent state of cloud gaming means that the CMA’s theory of harm is inherently highly speculative and the Provisional Findings paint an exaggerated and overly optimistic view of the prospects for the segment. As set out in section 3.C below, there is no evidence that cloud gaming is poised to “alter the future of gaming” 112 , certainly not within the five year timeframe within which the CMA must assess the potential impact of the Merger. 113
• In other words, the CMA accepts that Microsoft’s “multi-product ecosystem” is not relevant to assessing the impact of the Merger on cloud gaming rivals.

4 more annotations...

• Our revised model now suggests that making CoD exclusive to Xbox would result in a significant financial loss for Microsoft post-Merger. Given the magnitude of these potential losses under all scenarios that we considered to be plausible, we now place significantly more weight on the LTV model than we did at the stage of our Provisional Findings.
• We also consider that there is insufficient evidence to show that the less quantifiable long-term strategic benefits of a foreclosure strategy would outweigh the more tangible losses arising from a total foreclosure strategy indicated by the LTV model. As such, we now place less weight on Microsoft’s past behaviour and long-term strategic benefits in our assessment of Microsoft’s incentives to foreclose PlayStation than we did in the Provisional Findings.
• Gains are computed based on 5 years of anticipated gross margin from a new Xbox gamer. Losses are computed based on a single year of foregone gross margin on content sold to a CoD gamer on PlayStation.
• Since these gamers would have played CoD for a more limited time and/or spent less money on it than surveyed gamers, we now consider it appropriate to focus on an outcome in which these gamers would not switch consoles in response to a total foreclosure.
• Fourth, in our Provisional Findings, we weighted our survey results by spend and gametime on CoD to reflect that gamers spend different amounts of time and money on CoD. We now recognise that LTVs already reflect the value of gamers (including the value of gamers who would switch from Xbox to PlayStation in response to a total foreclosure strategy). As such, it is not necessary to adopt a further weighting to approximate that value more closely.

3 more annotations...