The drama continues between Sony and Microsoft about the acquisition of Activision Blizzard. Following Sony’s statements ten days ago, Microsoft is discussing new elements in a recent document published by the Brazilian Commission.
Microsoft responds to Sony with Call of Duty
The document in question is a small new goldmine that outlines Microsoft’s lines of defense for verifying the Activision Blizzard takeover. On August 1, Sony said it feared Call of Duty and Xbox Game Pass and announced that Call of Duty was a license capable of selling one console over the other.
In a document published in the last hours, Microsoft responds to certain statements made by its competitor. The American publisher, for example, says that “Not surprisingly, Sony is the only third party reporting a public opinion that is significantly different from MS/ABK and the third parties regarding the competitive analysis of the transaction.”
Regarding Call of Duty specifically, Microsoft believes that Sony’s arguments aren’t really supported by solid evidence, especially regarding license uniqueness.
Sony is limited to commenting on the strength, loyalty, and commitment of the Call of Duty brand. However, the assertion that Call of Duty has a loyal following is a premise that is not followed by the conclusion that the game is a “category of games in and of itself”. PlayStation itself has a steady base of gamers who are loyal to the brand. However, this finding does not support the conclusion that PlayStation – or any branded product with loyal consumers – is a separate market from all other consoles. Extrapolating from this finding, the extreme conclusion that Call of Duty represents a “category of games as such” is simply not justified in the context of quantitative or qualitative analysis.
Microsoft also mentioned that Call of Duty is just one of the popular games, along with others like Fifa, GTA, Assassin’s Creed, Resident Evil, and other Far Cry games, as well as other games that aren’t available on Xbox due to exclusive offers from Sony or Nintendo. .
Xbox Game Pass was already working fine without Activision
In a rather funny way, Microsoft also confronts Sony with its contradictions. The Japanese company mentioned how Call of Duty was a “game changer” in the equation, but Microsoft also mentions that Sony has praised the success of the Xbox Game Pass, despite the lack of an Activision/Blizzard game in the subscription. Proof of this is that Call of Duty is not a primary success factor for a platform.
As for the huge, non-refundable advantage that Microsoft will gain by integrating Activison Blizzard into Xbox Game Pass, Microsoft says this won’t happen for five reasons:
- 1. Microsoft indicated that it was not in its strategy to remove content from other platforms. We’ve already mentioned it a few times, and Call of Duty will still be available on PlayStation. “This fact reduces players’ incentives to switch to Game Pass, as they will be able to continue subscribing to their favorite service (such as Sony’s PlayStation Plus) as well as easily purchase a copy of Call of Duty.” “.
- 2. The data shows that gamers view subscription services as one of many ways to pay for games, something Sony itself has claimed. “If subscription services compete with the buy-to-play model, as Sony itself recognizes, and Activision content continues to be distributed through the buy-to-play channel, players can simply continue to choose the payment model they prefer to access Activision content.”
- 3. Microsoft remembers the dynamic nature of subscription services and the “appropriate presence of Sony itself in this area.” “In fact, subscription services are a modern monetization strategy. As much as Game Pass pioneered, it is a dynamic space with the emergence of new services and content, and there are already a number of existing companies and services. Sony already offers a subscription service, PlayStation Plus, which the company has been able to expand Its scope from the current user base, the size of the PlayStation platform, and its exclusive content. In fact, Sony has outpaced Microsoft in terms of console sales and installed base, selling more than twice as many consoles as the Xbox in the last generation.”
- 4. This reason is hidden due to confidential information.
- 5. Microsoft asserts that there is strong upstream competition and various competing game distribution channels, including stores and subscription services, which have access to a wide range of titles in addition to Activision Blizzard games, including exclusive content not available to Microsoft customers.
Finally, Microsoft also notes that the use of exclusive arrangements has been at the heart of Sony’s strategy to strengthen its presence in the gaming industry. Microsoft also claims that in addition to owning exclusive first-party content, Sony has also entered into agreements with third parties. – Party publishers to ensure other forms of exclusivity with respect to certain games, such as exclusive marketing or exclusive rights to downloadable content.
More importantly, Microsoft blames Sony and says its ability to develop the Xbox Game Pass has been hampered by Sony’s desire to prevent such growth. Sony will therefore pay a “blocking fee” to prevent developers from adding content to Xbox Game Pass and other competing subscription services. The Brazilian document hides many secret elements in this part.
Finally, Microsoft asserts that regardless of Sony’s criticism, the strategy of retaining Activision Blizzard games, without releasing them on competing consoles, would not be profitable for Microsoft, because such a strategy would be profitable only if Activision Blizzard games were able to attract a number of Big enough players to the Xbox console ecosystem, and whether Microsoft can earn enough revenue from selling games to offset losses from not distributing those games to competing consoles. It’s really hard to deny yourself the tens of millions of PlayStation customers interested in Activision Blizzard licenses.