Sony fears that Microsoft could create a monopoly with Call of Duty

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Call of Duty is a massive, sprawling video game franchise that has sent players through dozens of battlefields ranging from the beaches of Normandy to the abandoned city of Pripyat to the frozen moon of Europa. Now it has become the scene of a new conflict brewing between Sony and Microsoft.

In January, Microsoft announced its intention to buy Call of Duty publisher Activision Blizzard for $68.7 billion. While the Federal Trade Commission has been scrutinizing the deal in the United States, Brazil has also been scrutinizing Microsoft by the Administrative Council for Economic Defense (or CADE), the country’s national antitrust agency, and questioning various gaming companies including Ubisoft and Riot Games, Warner said Bros. Interactive Entertainment and Sony for comments on the potential merger. Of the 11 companies CADE contacted, Sony was the only objection.

At the heart of Sony’s concern was Microsoft, which may own Call of Duty, which Sony claimed would position Microsoft at the critical mass of a gaming monopoly. Microsoft had already acquired some of the most respected gaming franchises like Fallout, The Elder Scrolls and Doom after buying ZeniMax Media in 2020. These high-profile acquisitions were a key part of Microsoft’s plan to solidify the power of Xbox Game Pass, a subscription service where users gain access to a rotating catalog of downloadable games for a monthly fee.

“One of the reasons Microsoft’s Game Pass has grown so quickly is that Microsoft has acquired several third-party studios since 2017,” Sony wrote in its response to CADE, translated by The Washington Post. Sony noted that these studios included Double Fine, Obsidian Entertainment, Ninja Theory, and Bethesda, and content was added to Game Pass from each. “Such acquisitions have given Microsoft a greater amount of content – even without Activision’s games. Adding Activision’s games to that content would be a game changer.”

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Sony described Call of Duty as an exceptional property in the gaming world, one to which Activision dedicates an astounding amount of resources with impressive returns. To date, the series has generated $30 billion in revenue for Activision Blizzard.

Each annual Call of Duty title is the collaborative work of multiple studios working together for years. In a 2021 investor report, Activision said the franchise has over 3,000 employees. With such high production values, Sony claimed that no other publisher could possibly challenge Activision’s position in the market, citing Electronic Arts’ Battlefield (another blockbuster military action series) as a competitor that’s still woefully behind the most lucrative first work in the world remains. bodyguard. Call of Duty has sold 425 million copies in its lifetime. By comparison, Battlefield has sold around 88 million copies through 2018. EA has not yet announced the sales figures for its latest Battlefield game “Battlefield 2042” from 2021. Battlefield 2042 sales were described as “disappointing” by then-EA Chief Financial Officer Blake Jorgensen during the publisher’s investor call in February.

“No other developer can devote the same level of resources and expertise to game development,” Sony wrote. “Even if they could, Call of Duty is too entrenched that no rival – no matter how relevant – can catch up.”

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Additionally, Call of Duty is an extremely popular series among PlayStation owners, a devotion that Activision Blizzard has encouraged and rewarded. PlayStation players have long enjoyed exclusive Call of Duty perks unavailable to players on other platforms, such as: The Call of Duty League, Activision’s premier esports league for the series, competed exclusively on PlayStation for its inaugural season. PlayStation fans who pre-order Call of Duty: Modern Warfare II, the highly anticipated sequel to 2019’s Call of Duty: Modern Warfare, will also get their first access to the game’s open beta on September 16th – a full week in advance from Xbox and PC players who will have to wait until September 22nd.

Microsoft has assured the audience that if the merger goes through, Call of Duty will remain cross-platform. However, someone paying $10 a month for Xbox Game Pass could have access to every Call of Duty ever made and the latest releases at launch, along with access to hundreds of other games. Microsoft has previously employed a similar tactic with its own popular first-person shooter franchise, Halo. In comparison, a PlayStation player would have to purchase each Call of Duty title separately. The upcoming title Call of Duty: Modern Warfare II alone will cost $70 before players consider purchasing other games or purchasing Sony’s own gaming subscription service, PlayStation Plus.

But is that enticing enough for PlayStation owners to switch to Xbox? Sony believes so, describing Call of Duty gamers as die-hard fans who would readily switch to Xbox if it offered broader access to their beloved series. As Christopher Dring of GamesIndustry.biz points out, Microsoft, which owns the most popular video game series on PlayStation, puts Sony in a very uncomfortable position by giving its leading competitor a direct line to its fan base with every new Call of Duty game on its own system are .

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However, Sony has been building its own powerful stable of exclusive titles for years, including by buying talented studios. Bungie, the studio that created the Microsoft-exclusive Halo series, was the latest developer to be bought by Sony. The Last of Us series, as well as Uncharted, Marvel’s Spider-Man, Horizon and Ghost of Tsushima are all critically acclaimed Sony exclusives made by formerly independent studios now owned by Sony.

Microsoft pointed this out to CADE in its rebuttal to Sony’s comments, saying Sony has strengthened its own subscription service by working with Ubisoft, makers of the Assassin’s Creed and Tom Clancy Rainbow Six franchises, among others.

“The launch of the new PlayStation Plus, perceived by the industry as ‘the rival of Xbox Game Pass,’ reflects the intense rivalry in the game distribution industry,” Microsoft wrote. “Bringing the Ubisoft catalog of ‘Popular’ and ‘Best Selling’ games to PlayStation Plus reinforces this rivalry, while also emphasizing the diversity of high-quality third-party games available to subscription service providers.”

In a recent CADE filing, Microsoft claimed that Sony paid “lockdown rights” to Stonewall developers to add content to Xbox Game Pass, as reported by The Verge. According to a translator at gaming forum ResetEra, Microsoft also said it invested heavily in Xbox Game Pass in counterattack to Sony’s superior buy-to-play strategy in the previous generation of consoles.

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Third-party companies Ubisoft, Riot Games, Bandai Namco, and Google all agreed that Call of Duty does indeed have competitors like Apex Legends, Counter-Strike: Global Offensive, and Valorant. Sony disagreed, arguing that no major developer had yet succeeded in creating a franchise that could topple Call of Duty.

Recently, Respawn Entertainment’s Apex Legends, published by Electronic Arts, has enjoyed great popularity resurgence of popularity thanks to rapid updates, new game modes, frequent competitions, detailed worldbuilding, and a steady stream of overall content. Respawn is also directed by Vince Zampella, who is one of the co-founders of Infinity Ward and the production of Call of Duty, Call of Duty 2, the original Call of Duty: Modern Warfare in 2007 and 2009 oversaw Modern Warfare 2 (not the upcoming reboot).

Still, Sony insists that Call of Duty is just too big to fight, calling the franchise “a category of games unto itself.” And the company is struggling to prove it.

Gabriela Sa Pessoa in São Paulo contributed to this report.

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