Microsoft CEO Brad Smith made the case for Sony’s dominance in the video game market, and that they were trying to protect that dominance, in light of their opposition to Microsoft’s purchase of Activision Blizzard King.
Brad made these statements in a press conference in Brussels, following a closed hearing where the European Commission met with top execs from Microsoft, Activision, Sony, and others.
Earlier in the conference, Brad revealed Sony’s dominance in terms of market share compared to Microsoft. As reported by Christopher Dring for Games Industry Biz:
“Think about the market in Europe. It is a market where Sony has an 80% share. Globally, it is about 70/30. In Japan, it is 96/4. These numbers have been remarkably steady for two decades. Even last year, when there were issues with Sony’s supply chain, they came back strong.”
Later in the conference, Brad accused Sony of trying to “protect its two-decade dominance in video games.”
Brad is leaning on this argument about Sony’s dominance because it effectively neutralizes Sony’s own argument about why the deal should not go through. Sony’s claim has been that Call of Duty is such a significant player in the industry, that if Microsoft were allowed to complete the deal, that it would allow Microsoft to make the franchise an exclusive, ultimately, harming competition between the two companies.
We already reported on how Microsoft penned deals with Nintendo and Nvidia to bring Call of Duty to their platforms. Microsoft also has the support of Valve in this regard, who stated they turned down signing a similar contract because they already have Valve’s trust that they would keep bringing the games to their platform.
The other side of this argument, of course, is that Sony can’t be harmed that much by this deal, because Sony itself is already in such a dominant position in the video game console space.
It must be said that Brad is somewhat exaggerating Sony’s market dominance. While it’s true that PlayStation has been an overwhelming success for most of its existence, it has also seen its own share of failures and down periods. The Xbox 360, Wii, and Nintendo DS in particular overwhelmed the PlayStation 3 within the context of most of that console generation.
Still, ultimately Brad’s point is well made. Protecting competition in the video game industry does not mean literally protecting Microsoft’s competitor, Sony. Nintendo, Nvidia, Valve, are also in the space, and there are other stakeholders, including the employees of these companies. Microsoft has made their case with the public, and Sony will be hard pressed to counter argue it now.
