Xbox etches: Sony fears a new Call of Duty will come free in Game Pass on Day 1, destroying the PS5’s dominance

There is a conflict between Microsoft and Sony. Because Microsoft has announced that it will buy Activision Blizzard. This would give Microsoft ownership of the Call of Duty franchise, one of the most important franchises in the world. Sony has explained the problems this poses – but Microsoft now says Sony fears losing its dominance in the console market, which exclusive titles have created. Because an Xbox Game Pass with Call of Duty would endanger Sony’s business model.

What is this conflict?

• Microsoft announced its intention to buy Activision Blizzard (Call of Duty, WoW, Diablo) in January 2022
• This purchase must be approved by various regulatory authorities worldwide. Because with a merger of such large market participants, there is a risk that a monopoly will form, which endangers the free market.
• Brazilian regulators had asked some gaming and tech companies what they thought of the purchase, whether it would endanger the diversity of the market
• Almost all companies had no objections, only Sony remarked: Call of Duty is a unique game and has no competition and will never have any. That was given as a concern if Microsoft now buys Activision Blizzard

The release of a new Call of Duty is the gaming event of the year for many shooter fans:

If Call of Duty is that unique, so is PlayStation

This is what Microsoft says now: Microsoft has responded to Sony’s reservations. In a 27-page document, an attempt is made to refute Sony’s statements (via vgc)

Microsoft argues Call of Duty is not a “unique game”. Sony would contradict itself. Because if Call of Duty is unique because it has loyal followers, then the PlayStation must also be unique, because they also have loyal followers.

Sony’s own Playstation has an established base of players loyal to the brand. However, this realization does not lead to the conclusion that the PlayStation – or any other brand with loyal supporters – forms a separate market from all other consoles.

Deriving the idea from this knowledge that Call of Duty is a separate genre of games cannot be proven – neither under qualitative nor quantitative analysis.

Microsoft thinks it’s about Xbox Game Pass vs. PS Plus

What does Microsoft think is behind it? Microsoft believes that Sony is actually not so much concerned with Call of Duty, but with the dominance of Xbox Game Pass over Sony’s subscription model, PS Plus.

Sony doesn’t want new Call of Duty games to be included in Game Pass on Day 1 release because they would be “annoyed at having to compete with Microsoft’s subscription model.”

Sony’s public statements about subscription games and its response to the authority’s letter make it clear: Sony does not want an attractive subscription model to threaten its dominance in the digital distribution market for console games.

In other words, Sony rails against introducing new monetization models capable of challenging their business model.

From Microsoft’s point of view, Sony is concerned with protecting its dominance in the console market through the PS5 and the PS Plus business model.

The Xbox Game Pass would be even more attractive with a “free” Call of Duty right at the release. Sony apparently wants to prevent this with its concerns about the takeover of Activision Blizzard.

Microsoft says: Sony fears Game Pass and wants to actively hinder it

Microsoft accuses Sony of this: Microsoft says Sony has been actively trying to stem the growth of Xbox Game Pass by paying some developers not to bring certain content from their games to Game Pass (via vgc). Microsoft speaks of “blocking rights”:

This again shows the fear of an innovative business model that offers players high-quality content for a low cost. This jeopardizes a reign that has been forged over years from a platform and exclusive-driven approach.

Call of Duty exclusively for Xbox would be economically nonsensical, says Microsoft

Will Call of Duty be Xbox exclusive? In further statements, Microsoft says it has no plans to exclude Call of Duty from the PlayStation. It just wouldn’t make economic sense.

Because then you would have to earn more from Xbox sales than you lose from losing Call of Duty sales on PlayStation (via vgc).

What are the different business models of Sony and Microsoft? There are clear differences in the business model of the two console giants:

• Sony relies heavily on high-quality exclusive titles from its own studios that come onto the market as full-price titles. Your PS Plus subscription service is required to play online on the PS5. In addition, there are some older games or budget titles free for subscribers each month. Sony wants to focus more on Free2Play and service games instead of bringing big titles directly to the PS Plus release.
• Microsoft, on the other hand, has developed the “Xbox Game Pass” in recent years: a kind of “flat-rate gaming subscription” based on the Netflix model. Big, new titles keep appearing on the release day in Xbox Game Pass.

Microsoft apparently believes that their business model is superior to Sony’s and that buying Activision Blizzard can make Xbox Game Pass even more attractive if titles like Call of Duty or new games from Bethesda like Starfield or a The Elder Scrolls 6 are part of the offer will.

The Xbox Game Pass is a success story:

Game Pass: How an MMO helped Xbox transform gaming forever