Phil Spencer Accuses Sony Of Growing Their Business By “Making Xbox Smaller”

In a new podcast interview, Phil Spencer accuses Sony of growing their business by making Xbox smaller.

Phil was of course, asked again about the investigation of Microsoft’s pending acquisition of Activision Blizzard King, which has now been blocked by the FTC.

The knives are definitely out as Phil characterizes their competitor as having ‘a very different view of the industry than we do’, by which he means they don’t launch their games simultaneously on PC and their platforms, and they don’t put those games on their subscription services.

Phil then delves into the argument about Microsoft planning to withhold Call of Duty on PlayStation. He points out that their planned ten year commitment for the game on their competitor’s platform would be for both companies to get the same version of the game, with the same features.

He also point out that, in terms of revenue, Microsoft would actually have to write off billions and billions in dollars they wouldn’t be making if they really went ahead with removing future Call of Duty games from Sony’s platforms, “the largest console version of Call of Duty out of the business model of this company.”

Phil’s comments seem to be a new salvo in their PR war with Sony over the Activision Blizzard King acquisition. As regulators continue to investigate and decide on the deal, we can expect both companies to get even more glib about how they really feel about each other.

It’s a somewhat strange turn of events when you consider that only a few years ago, both Sony, Microsoft, and Nintendo seemed to have put on a united front against Google Stadia, Apple Arcade, and Amazon Luna, when it seemed that those mobile and cloud based platforms were a serious threat to the primary console platforms.

Of course, this Activision Blizzard King deal, if it pushes through, would be a major even in the industry, affecting thousands of jobs, and the millions of dollars companies make and who’s making them.

And so, now that Google Stadia is no longer a going concern, and Apple Arcade and Luna have proven to be not as serious a problem to the big two as it first appeared, Sony and Microsoft are back at each other’s throats again, in a slightly different theater of their PR war.

The full transcription of Phil’s comments can be read below.

“There is really only been one major opposer to the deal, and it’s Sony. And Sony is trying to protect their dominance on console. And the way they grow, is by making Xbox smaller.

They have a very different view of the industry than we do. They don’t ship their games same day on PC, they don’t put their games on subscription when they launch their games. They’re starting to think about mobile – from the outside, I’m seeing some of the moves that they’re doing.

But because Sony is leading all of the dialogue around why this deal shouldn’t go through, to protect their dominant position on console, the thing they grab onto is Call of Duty. And, we said over and over, we’ll make a multi-year, ten year commitment to PlayStation.

In the first call Satya (Satya Nadella, CEO of Microsoft) and I made to ship Call of Duty on PlayStation, we made a call to the CEO of Sony the day that the deal was announced to say that it’s our intent to keep Call of Duty on PlayStation.   

They actually publicly affirmed that at the time. Now, we’re kind of getting on the slow roll on the negotiations because it’s become good fodder for the regulators to discuss this.

If you just look at the deal model itself, it’s not hard to think about how much of the valuation of this company is Call of Duty revenue that happens on PlayStation. And to pay what we’re paying for the total of Activision Blizzard King, and then instantly impair the asset by saying “We’re going to pull the largest console version of Call of Duty out of the business model of this company”, literally would take billions and billions that we would have to write off almost instantly because we would impair what Activision made.

We’ve made the statements to Sony that we would continue to ship Call of Duty on PlayStation. We’ve tried to make a ten year commitment – same version, same features. We’ve said the same thing to regulators.

I haven’t really heard a customer opposition of how a consumer, who’s going to get more choice through this acquisition, what the harm is. But the hard harm to the largest console maker seems to be where the regulators are spending a lot of time, and they’re really twice as big as we are in the console market.

So I find it challenging, that the largest console maker in the world, is raising an objection about one franchise that we’ve said that we will continue to ship on the platform. And it’s a deal that benefits customers through choice and access.

And like I said, Call of Duty mobile is a franchise itself, how to decouple that from other platforms seems really really challenging, when PlayStation players are going to get the same Call of Duty experience hey had this year, is the same thing they will have next year forward, when this deal closes.”

Source: Second Request podcast via GameRant