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Microsoft has proffered a deal to Sony for COD to be available on PlayStation for 10 years upon completion of the Activision acquisition.
Microsoft (NASDAQ: MSFT) has reportedly offered Sony (TYO: 6758) a provisional 10-year deal regarding Call of Duty’s licensing rights on the PlayStation console. Should Microsoft’s massive Activision deal go through, the American tech giant is willing to make Activision’s Call of Duty available on PlayStation alongside Xbox.
According to Microsoft’s President Brad Smith, the deal offered to Sony to share each new Call of Duty release spans 10 years. Furthermore, the Washington-based tech corporation hopes that this gesture will assuage the antitrust fears of its rivals and regulators. Smith agrees that Microsoft should extend an olive branch to Sony upon completion of the Activision deal, as the alternative would be “economically irrational”. The Microsoft President also acknowledges that the popularity of cross-play games makes it imperative to make concessions with Sony. Furthermore, in addition to Activision raking a vital part of COD revenue from PlayStation game sales, Smith wants to avoid alienating video gamers.
“That’s why we’ve offered Sony a 10-year contract to make each new ‘Call of Duty’ release available on PlayStation the same day it comes to Xbox. We’re open to providing the same commitment to other platforms and making it legally enforceable by regulators in the US, UK, and European Union,” he explains.
Japanese Gaming Stakeholder Weighs in On Proposed Microsoft Deal to Sony PlayStation
On the heels of Microsoft’s 10-year deal offer to Sony PlayStation, Serkan Toto, CEO of Kantan Games, said:
“A 10-year commitment sounds significant; Sony would be indeed ‘safe’ during the lifecycle of the PlayStation 5 but could run into trouble by the time the next console generation begins.”
The chief executive of the Tokyo-based games consultancy further explained that the offer might hold forth only short-term. However, it may be just enough to assuage regulators so that they do not stand in Microsoft’s way toward completion. As Toto put it:
“So I believe the offer will not be enough to squash Sony’s concerns, but it might calm down regulators to some extent.”
Pending FTC Antitrust Lawsuit
Last month, reports stated the US Federal Trade Commission would likely file an antitrust lawsuit to pause Microsoft’s planned $69 billion takeover of Activision. The way FTC Chair Lina Khan sees it, Microsoft’s sole ownership of the popular video game publisher is bad news for competitors. Khan reckons that Microsoft would have exclusive rights to wildly popular intellectual property like Call of Duty, thus attaining an unfair competitive advantage. The anticipated FTC lawsuit represents the largest of its kind under Khan’s watch and marks her latest attempt to rein in global tech power.
However, Smith recently responded to the FTC’s allegations of unjust Microsoft monopoly in the gaming space. Criticizing any potential lawsuit, the Microsoft President defended the Activision acquisition as good for gamers. Furthermore, Smith also added that an FTC lawsuit would be detrimental to consumers, competition, and countless game developers.
Despite Microsoft’s latest gesture of goodwill towards Sony and concerned regulators, how Sony responds remains to be seen. Questions arise as to whether the Japanese tech powerhouse will accept the terms of the deal.