The first day of negotiations in the FTC’s lawsuit against Microsoft’s planned acquisition of Activision was focused on exclusive games. The FTC accused Microsoft of attempting to hinder competition by releasing games exclusively for Xbox and PC, thereby damaging the console and cloud market. Two examples cited were the upcoming “Starfield” and “Indiana Jones” games, both being developed by Bethesda, which Microsoft acquired in 2021. These games are set to be exclusively released for Xbox and PC, not for Playstation. This announcement that the “Indiana Jones” game would not be available on Playstation is new information. Initially, Bethesda had negotiated a deal with Disney for a multi-platform release, but after Microsoft’s takeover, the release on Playstation was canceled. The FTC argues that these cases demonstrate Microsoft’s interest in offering exclusive titles, putting their competition at a disadvantage.
The issue of exclusivity has been a topic of discussion for months among antitrust authorities. Microsoft defends its decision to forgo a Playstation release for certain titles, noting that it wouldn’t be economically viable for larger titles like “Call of Duty.” Microsoft has assured Sony, who strongly opposes the Activision takeover, that it intends to offer “Call of Duty” games on the Playstation console in the future. They compare “Call of Duty” to “Minecraft,” stating that established brands like these can continue to be played on Playstation. The Activision Blizzard acquisition would also give Microsoft control over brands such as “Diablo” and “Starcraft,” in addition to “Call of Duty.” While the deal has been approved by EU antitrust authorities, the FTC has decided to file a lawsuit. British antitrust authorities seek to block the deal, and Microsoft has raised objections with the Competition Appeal Tribunal.
The FTC’s argument is questioned by an email from Sony’s Playstation boss, Jim Ryan, sent last year to a colleague. In the email, Ryan states that Microsoft’s acquisition of Activision is not solely about exclusive games, but rather, they have bigger plans. Ryan expects to see “Call of Duty” on Playstation for years to come. Ryan is scheduled to be questioned during the court hearings. His statements contradict Sony’s public stance, as the company aims to prevent the Activision takeover and raises concerns about Microsoft’s potential exclusive strategy. Microsoft’s past concessions were primarily a response to external pressure. The court hearings are expected to continue until June 29th, with witnesses such as Microsoft CEO Satya Nadella and Activision CEO Bobby Kotick scheduled to appear.
