What you need to know
- The FTC is currently suing to block Microsoft’s acquisition of Activision on the basis of protecting competition in new markets such as game subscription services.
- Despite this, a new report suggests that Sony’s Jim Ryan, chief complainant against the deal, doesn’t regard Microsoft’s Xbox Game Pass service as competition.
- Microsoft has offered Sony a ten year deal for Call of Duty, something PlayStation declined to respond to.
A new report from Insider Gaming suggests that PlayStation lead Jim Ryan’s private opinion of Xbox Game Pass is at odds with his public one.
Sony PlayStation is Microsoft’s primary competitor in the console space, and they are among the only companies to publicly and privately complain to global regulators about Microsoft’s deal to purchase Activision Blizzard. Call of Duty exclusivity is often cited as the main reason PlayStation is supposedly “afraid” of the deal, despite the fact Microsoft has offered a contract for an unprecedented 10-year guarantee to provide Call of Duty to PlayStation, alongside Nintendo and Steam PC platforms.
The U.S. regulator has sought to block the deal, with the view that consolidation would supposedly “harm” competition in developing markets like cloud streaming and subscription services — two areas where Sony has apparent limited interest in investing into. Sony seeks instead to preserve the status quo, of the annualized retail Call of Duty, owing to the vast amount of money the company makes from full $70 versions of the game. Microsoft has pledged to put Call of Duty into Xbox Game Pass for $10 per month — something that would benefit everybody except Sony’s shareholders.
This new report suggests that Jim Ryan may be misleading regulators with Sony’s position on the deal. If true, Ryan reportedly downplayed Xbox Game Pass in an internal Q&A with PlayStation employees, which would be embarrassing for the FTC, whose entire lawsuit hinges on the idea of Xbox Game Pass hurting PlayStation.
Ryan reportedly responded to questions about Xbox Game Pass dismissively, “When we consider Game Pass, it seems to be getting lower [Game Pass numbers]. When we consider Game Pass, we’ve sold more PS5s in two years than they have gathered subscribers, and they’ve been doing that for 6-7 years.”
Windows Central’s take
If accurate, this episode further backs up Microsoft’s previous claims that Sony is attempting to mislead regulators. The FTC has placed a large amount of emphasis on developing markets in its current regulatory ideology, blocking Meta / Facebook from acquiring VR companies in an attempt to stymie its growth — despite the fact few others are investing in this tech.
Similarly, Sony is only investing scant amounts in its own subscription and cloud services. PlayStation Now remains the lowest quality option for cloud gaming, left in the dust by NVIDIA GeForce Now and Xbox Cloud Gaming, with fewer games and fewer servers. Sony also only invests limited amounts in its PSN+ service, only placing its first-party titles in there several months or even years after their full retail versions. Microsoft conversely is offering more value for its customers, with a guarantee to place upcoming AAA exclusives like Redfall, Starfield, and others day and date into the subscription. This is far less costly for consumers, and the idea that the FTC would prevent the growth of this market is an egregious dereliction of duty.
For Sony’s Jim Ryan to claim privately that Xbox Game Pass isn’t truly competition for PlayStation just adds further fuel to the idea that the FTC’s position is completely untenable, and driven by a poisonous cocktail of ignorance and ideology.
