from the 10-year-sunset dept
Well, well. The fight between Sony and Microsoft over the latter’s proposed acquisition of Activision Blizzard continues to get more and more interesting. As three regulatory bodies have been poking at the deal — the European Commission for the EU, the Competition and Market Authority (CMA) in the UK, and the Federal Trade Commission (FTC) in the States — Microsoft’s featured attempt to appease the concerns over Call of Duty suddenly going exclusive has been its inking of 10 year deals to keep the series multi-platform. This seems to have placated the EU thus far, though its impact on the CMA and FTC remains to be seen. The idea, though, is that it is a demonstration of Microsoft’s commitment to keep CoD multiplatform generally. As I have pointed out in repeated posts, that doesn’t necessarily make sense. After all, Microsoft could be playing the long game, inking these deals to get the purchase done with plans to yank the series back to an exclusive after the ten year deals expire.
And if you read between the lines, Microsoft may have tipped its hand on that to the CMA in a recent leak of testimony from the company.
As spotted by VGC, Microsoft argued in a supplemental response that its 10-year proposal to keep Call of Duty available on PlayStation 5 and future Sony consoles is plenty of time and wouldn’t leave the hardware manufacturer on a “cliff edge” once it expires. Why not? Because Sony can use that time to make its own version of the best-selling military shooter.
“Microsoft considers that a period of 10 years is sufficient for Sony, as a leading publisher and console platform, to develop alternatives to CoD. […] The 10-year term will extend into the next console generation. […] Moreover, the practical effect of the remedy will go beyond the 10-year period, since games downloaded in the final year of the remedy can continue to be played for the lifetime of that console (and beyond, with backwards compatibility).”
There are plenty of clues to go off in the quoted statement from Microsoft to the CMA. The reference to developing alternatives is what most folks are keying in on. While not explicit, what is obviously implied there is that over 10 years Sony can develop a CoD competitor such that it need not worry if the series no longer appears on Sony’s PlayStations.
For me, though, I got laser-focused on the reference to “the final year.” Final year of what? This particular 10 year agreement? The final year of Microsoft having CoD titles released as multi-platform? Nowhere do I see any reference to suggestions that these deals can be renewed after the 10 years have expired. With that lack of clarity otherwise, it sure feels like this is talking about the end of the series being multi-platform.
As to Microsoft suggesting that Sony go build a competitor to CoD, well, why couldn’t Microsoft do that instead of gobbling up Activision?
“We’re not good enough” has actually been Microsoft’s line throughout these messy proceedings, however. One of its main arguments rests on the idea that, after being trounced by Sony and the PS4 for years, a massive acquisition is actually one of the only ways to disrupt the marketplace and create more competition. The implication has effectively been that Microsoft can’t make hits on its own so it needs to buy them instead.
None of this changes the simple fact that Sony has, with some recent deviations, traditionally been more than happy to keep a ton of its first- and third-party titles exclusive to the PlayStation. Sony also has absolutely trounced Microsoft in the console market year after year.
There are no good guys here, in other words. But as far as this acquisition is concerned, Microsoft’s comments above sure should have regulators raising their eyebrows.
Filed Under: antitrust, call of duty, competition, uk
Companies: activision blizzard, microsoft, sony
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