For months, Microsoft has sworn up and down that it doesn’t want to take the Call of Duty franchise away from PlayStation as long as its proposed acquisition of Activision is finalized. But Sony cites the story of Microsoft’s acquisition of Bethesda Softworks parent company ZeniMax as the main reason it doesn’t exactly trust Microsoft on this matter.
In a submission to the UK Competition and Markets Authority (CMA) released last week, Sony noted the decision of the European Commission to allow the acquisition of ZeniMax by Microsoft in 2021. In that decision, the EC cited Microsoft’s planned business strategy in concluding that “the combined entity would not have the incentive exclude rival console video game distributors by engaging in a strategy of total or partial exclusion of inputs [emphasis added].”
In other words, the European Commission said it felt Microsoft would have no reason to withhold future Bethesda games from rival platforms like PlayStation. However, shortly after the deal was approved, Microsoft seems to have found that “incentive” quite easily.
In June 2021, Microsoft announced that the next star field it would not be available on PlayStation consoles (a move that led to a Bethesda executive publicly apologizing to PlayStation fans). The next Elder Scrolls VI it was also confirmed as an Xbox/PC exclusive back in November, just over a year after director Todd Howard said such an exclusive would be “hard to imagine.”
The FTC also took note of this part of the EC’s report, saying that Microsoft went back on its “assurances” to the EC. Technically, however, that part of the report was less a promise by Microsoft and more assumption by the EC on the basis of its reading of Microsoft’s own plans. And that involvement wasn’t key to the deal’s approval by the European Union, anyway: exclusivity for Bethesda’s games “would not have a material impact on competition,” the Commission wrote.
Still, the entire Bethesda saga has Sony concerned that any current promises about long-term multi-platform plans for the Call of Duty franchise could be equally weak. “[Sony] is extremely skeptical that a deal can be reached with Microsoft, let alone monitored and enforced effectively,” the company wrote to the CMA. “There is no realistic prospect of an agreement of this type being reached that would maintain effective competition.”
lack of trust
Microsoft’s offer of a binding 10-year contract to keep Call of Duty on PlayStation is not enough to address those fears, Sony wrote, as those arrangements “say nothing” about the long-term competition concerns identified by the findings. provisions of the CMA. As Sony notes, those interim findings already indicate that “the merged entity’s post-transaction incentives would be very different from Activision’s current incentives.”
Getty Images | Bloomberg
Even if the CMA were to try to enforce a so-called “behavioral remedy” to keep Call of Duty cross-platform, that move would not “address the myriad ways Microsoft could evade its obligations,” Sony wrote. Sony also said that Microsoft has a “history of breaking behavioral commitments,” pointing to Bethesda, as well as previous broken commitments regarding Windows and Internet Explorer.
Regardless of Microsoft’s promises now, owning Call of Duty and other Activision franchises would give Microsoft significant “competitive leverage… over the fate of PlayStation (for example, by controlling the price and quality of Call of Duty). “.
In his own submission to the CMA, Microsoft once again noted that it “has no intention of … making Call of Duty exclusive to the Xbox platform” and that its proposed deals with Sony would mean that the PlayStation versions would match the Xbox “on release date.” , content, features, updates, quality and gameplay”. Microsoft proposed a supervising trustee, objective outside counsel, and a fast-track dispute resolution mechanism to help enforce those promises.
For Sony, however, it appears there is no compliance regime or set of magic words that would make the company trust and accept Microsoft’s ownership of Activision and Call of Duty. The only solution that Sony would accept is the one proposed by the CMA itself: Microsoft immersing itself completely in the Activision or Call of Duty businesses after the acquisition. The CMA will make its final decision on the matter by April 26.
