Activision Blizzard: Microsoft shoots back at Sony

Microsoft rejects Sony’s claim that the Activision acquisition is anti-competitive and shoots back at PlayStation.

As we’ve reported extensively before, Sony has announced major concern over Microsoft’s acquisition of Activision. It was also announced that it would take years to create an Xbox Game Pass competitor and that Call of Duty alone would determine which console to choose.

In a 27-page document, Microsoft is now responding to Sony’s concerns, allegations and allegations that it has communicated to the regulatory authorities, and is clearly shooting back at PlayStation.

Idas, a member of the Resetera forums, has once again taken the trouble to translate Microsoft’s responses. The full article is there here. We have prepared some excerpts from the document for you here.

“In short, Sony hasn’t resigned itself to having to compete with Microsoft’s subscription service. Sony’s public outcry about subscription games and the company’s response are clear: Sony doesn’t want attractive subscription services to jeopardize its dominance of the digital console game distribution market. In other words, Sony resists the introduction of new monetization models that could challenge its business model.”

Microsoft believes that when Sony suggests that Game Pass could achieve unrivaled leadership in subscription services, it fails to mention its own leadership in digital distribution of console games.

“Sony is indeed the largest digital distributor of console games. As such, Sony’s concerns about potential competition from Game Pass merely reflect the usual resistance of traditional, incumbent companies to competition on merit from disruptive players.”

Microsoft also says that this complaint against services like Game Pass also reveals Sony’s real concern:

“Fear that an innovative business model that gives consumers access to high-quality content and a lower upfront cost threatens its leadership position in the gaming industry as Microsoft moves away from a ‘device-centric’ business strategy (in the sense that gamers have to buy expensive PCs or consoles to have access to the best quality games) towards a more ‘gamer-centric’ strategy.”

They also point out that leveraging exclusive deals is central to Sony’s strategy to strengthen its presence in the gaming industry. According to Microsoft, Sony has not only acquired exclusive content for first-party providers, but has also entered into agreements with third-party providers to secure other forms of exclusivity for certain games, such as marketing exclusivity or exclusive rights to downloadable content.

Given that Sony is a leader in digital games distribution, Microsoft finds Sony’s concerns about the possible exclusivity of Activision content to be incoherent and sees only:

“Fear of an innovative business model that offers players high-quality content at a low cost, threatening a leadership that grew out of a device-centric strategy and years of focus on exclusivity.”

In fact, Microsoft says its ability to continue growing Game Pass has been hampered by Sony’s desire to stave off such growth. Sony pays for “blocking rights” to prevent developers from adding content to Game Pass and other competing subscription services.

In conclusion, the Redmond-based company says that regardless of how unusual Sony’s criticism of the content is, the reality is that the strategy of keeping Activision Blizzard’s games and not distributing them in competing console stores simply wouldn’t be profitable for Microsoft . So a Call of Duty exclusivity is off the table.

Other justifications and answers have been redacted.

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