In a new editorial published by the Wall Street Journal, Microsoft’s president Brad Smith revealed and confirmed that the company offered Call of Duty to PlayStation for ten more years.
He made this revelation while making the case in his editorial that Microsoft’s acquisition of Activision Blizzard would be good for the industry, and not harmful.
Brad reiterates their argument that Microsoft is third place in video game consoles, and subsequently that they do not have a meaningful presence in mobile games. He also notes that mobile gaming is controlled by Google and Apple. Mobile games is simultaneously the fastest growing gaming market, and the segment that makes the most revenue.
Microsoft’s case for the acquisition is that they want to offer a new product that will disrupt the industry. By creating a cloud gaming service, they can offer a large number of games that will be playable on multiple devices for a reasonable fee. They also assert that this would benefit developers who would get more exposure.
So, where does Activision Blizzard enter the picture? Brad asserts that they don’t have enough popular games to make such a service successful. Acquiring the gigantic game studio would give them not only Call of Duty, but also games like Candy Crush and World of Warcraft.
Brad further argues that it would be “economically irrational” for them to stop offering Call of Duty on PlayStation because a “vital” part of the franchise’s revenue comes from the platform.
Astoundingly, Brad states that they are willing to commit to make Call of Duty games available on the same day on PlayStation and Xbox for the next few years. This is the first significant concession that Microsoft has revealed in the middle of this investigation, as well as in the negotiations the two platform holders have been holding in private. Microsoft is willing to hold themselves legally accountable to this commitment to regulators in the US, UK, and EU.
Brad then makes this interesting statement:
“Some regulators worry that any big-tech acquisition will harm consumers and workers. But Microsoft committed in February to govern its new cloud-based game store by the pro-competition principles outlined in the app-store legislation pending in Congress. And in May we negotiated a precedent-setting agreement with the Communications Workers of America allowing workers to organize easily at studios, including Activision Blizzard.”
Brad’s statement matches up with New York Post’s report from yesterday that the deal has a real endorsement from the Communications Workers of America.
While Brad’s essay is definitely not going to be enough to answer all regulatory questions, Microsoft’s president has nonetheless made a strong case for the public to accept the deal.
If Microsoft does offer some small bonuses that would make Xbox the better platform for Call of Duty than PlayStation, Sony would still be able to offer the game, alongside their own exclusives from first and second party developers.
It will be interesting to see if Microsoft continues to make concessions and push public relations to get this deal approved, and what other companies, not just Sony, will say in response.