By
Godfrey Benjamin
April 26th, 2024
Regulators in the US, UK, and EU were proposing to pull “Call of Duty” from PlayStation and offer it exclusively on Xbox and PC.
Microsoft Corp (NASDAQ: MSFT) has signed a 10-year agreement with Sony Corporation (NYSE: SONY). Within the deal, Microsoft will keep the franchise of the “Call on Duty” video game on PlayStation. The binding agreement follows Microsoft’s acquisition of Activision Blizzard Inc (NASDAQ: ATVI).
We are pleased to announce that Microsoft and @PlayStation have signed a binding agreement to keep Call of Duty on PlayStation following the acquisition of Activision Blizzard. We look forward to a future where players globally have more choice to play their favorite games.
— Phil Spencer (@XboxP3) July 16, 2023
Regulators in the US, UK, and EU were proposing to pull “Call of Duty” from PlayStation and offer it exclusively on Xbox and PC. However, most of the game’s revenue is generated from PlayStation sales. Therefore, Microsoft is not going to make games exclusive to its own consoles and displace Sony from the competition.
Initially, Microsoft offered to keep “all existing Activision console titles on Sony, including future versions in the Call of Duty franchise or any other current Activision franchise on Sony through December 31st, 2027.” The proposal was made back in January 2022. However, the terms of the deal have changed since then. The deal now covers only the “Call of Duty” game, with the extension of the timeframe to 10 years.
The deal marks the end of endless disputes over Microsoft’s intention to acquire Activision Blizzard company.
Microsoft’s president Brad Smith said:
“From Day One of this acquisition, we’ve been committed to addressing the concerns of regulators, platform and game developers, and consumers. Even after we cross the finish line for this deal’s approval, we will remain focused on ensuring that Call of Duty remains available on more platforms and for more consumers than ever before.”
The deal is almost finalized, the acquisition will be closed tomorrow.
Scrutiny Over Acquisition of Activision Blizzard
Back in January 2022, Microsoft announced plans to acquire video game giant Activision Blizzard which created “Call of Duty” for $68.7 billion in cash. Over the course of the year, the proposed acquisition faced scrutiny and challenges from competition regulators in the US, UK, and EU. As the Federal Trade Commission (FTC) explained, the acquisition of Activision Blizzard by Microsoft would pose a huge threat to the cloud gaming, subscription services, and consoles industry. In particular, Microsoft would limit competition in the video game console market, thereby securing its dominance. FTC has even filed a lawsuit to prevent the deal closure.
In the UK, the Competition and Markets Authority (CMA) also protested against the deal and blocked it in April 2023.
The disputes over the acquisition have been ongoing until July 11, 2023, when the judge of the District Court in the Northern District of California ruled that Microsoft could go ahead with the deal in the US. By now, as many as 39 countries have approved the deal on condition it will not hurt the competition in the industry. The closure of the acquisition deal is scheduled to be completed by July 18.