What you need to know
- Sony is angry again about the deal between Activision and Microsoft.
- In comments to the UK CMA, Sony claimed that Microsoft has not offered solutions, despite Activision CEO Bobby Kotick saying Sony is refusing to call back.
- Microsoft again proposed legally binding mechanisms to continue bringing Call of Duty to PlayStation – something it would of course continue to do anyway, like Minecraft.
- Sony also bizarrely claims that Microsoft will deliberately introduce bugs into the PlayStation versions of Activision games to undermine its business.
The UK’s competition regulator, known as the CMA, has just released its latest round of responses from Microsoft and Sony regarding the big Activision deal.
Microsoft is trying to buy Activision-Blizzard for a massive $69 billion dollars. Competition authorities around the world have been investigating the deal and what impact it could have on the video game industry. The vast majority of stakeholders are in favor of the deal, including Activision shareholders, unions, and even Microsoft’s competitors such as NVIDIA and Tencent. One notable exception, of course, is Sony PlayStation, which pulled out all the stops to try and get the deal blocked.
As part of the regulatory process, the CMA just published some responses from Microsoft and Sony. Microsoft has offered Sony an unprecedented and legally binding 10-year deal for Call of Duty, complete with content and feature parity. Microsoft has also offered the same deal to Steam for PC, NVIDIA GeForce Now cloud gaming, and Nintendo Switch, all of which are currently missing the popular shooter. Despite being legally binding with third-party surveillance offers (something Microsoft has had to do for LinkedIn in the past), Sony is still not happy.
Sony claims that Microsoft has made no attempt to engage with them about the details of the deal, which is strange considering that Microsoft has repeatedly and publicly offered a legally binding deal to Sony for Call of Duty. “In the intervening period, Microsoft has shown no real commitment to achieving a negotiated outcome. They dragged their feet along, engaged only when they felt the prospects darkened, and preferred negotiating with the media to engaging from SIE (Sony).”
In response to the CMA’s claims that the Nintendo Switch can’t run Call of Duty, Microsoft has listed a slew of games that are optimized for current-gen systems but also work great on the Nintendo Switch, including DOOM Eternal, Apex Legends and soon. Activision has estimated that such optimizations can be completed in a redacted number of months. Microsoft also reiterated that it is proposing a package of legally binding licensing clauses to ensure PlayStation’s so-called “concerns” are met.
Microsoft also offered to put Call of Duty on the PS+ subscription service, but Sony says in the documentation that it would hurt their $70 game business, making Call of Duty an Xbox Game Pass exclusive – whatever their game business of $70. There’s no mention, of course, of how consumers would benefit from getting Call of Duty in PS+ or Xbox Game Pass.
Take from Windows Central
Sony’s claims that Microsoft has refused to negotiate directly contradicts Activision CEO Bobby Kotick, who officially said that Sony rejected calls from Microsoft and Activision on the matter. It’s potentially a smart play on Sony’s part, as the UK doesn’t have a typical legal mechanism for presenting these arguments in a court of law. Sony is thus able to “creatively” portray the situation with impunity, as it only needs to convince the arguably clumsy UK regulator. Sony very laughable claims that Microsoft will deliberately add bugs to the PlayStation versions of Call of Duty to undermine its platform. This is the level we are playing at now, and the worst part is that the UK regulator is likely to buy it.
Microsoft’s chances with regulators in the United States and the European Union seem much better. Microsoft could take the FTC to court to possibly close the deal in the US and put all the facts on the table. Overall, the European Union seems more favorable to the deal because of its penchant for looking at the facts of the matter, not clouded by political ideology. In the case of the United Kingdom, the CMA unfortunately has no guidance, to use a British expression.
Activision CEO Bobby Kotick recently noted that the UK would become a “Death Valley” technology investment if it blocked the deal, a possibility exemplified by famed British chipmaker Arm turning down its own local exchange for a public listing in the United States. States instead.
I just want Starcraft 3.
Big thanks to @Rand_Al_Thor_19 And @EverbornSaga for the tips.