In a lengthy document submitted to the Brazilian government as part of its investigation into Microsoft’s acquisition of Activision Blizzard, Microsoft has claimed that Sony pays developers “blocking fees” to prevent games from appearing on Xbox Game pass
The allegation appears in a 27-page rebuttal of Sony’s recent objections to Microsoft’s purchase of Activision Blizzard, made to Brazil’s Administrative Council for Economic Defense (CADE) as part of its investigation. Much of Sony’s argument had focused on Call of Duty, which it claimed had “no rival” and was “so popular that it influences users’ choice of console”, with the PlayStation maker suggesting, among other things, that the inclusion of Call of Duty on Microsoft’s Game Pass service would hinder its ability to compete.
Microsoft’s response is as broad as Sony’s initial objections, from the fact that it has previously managed to grow Game Pass without Activision Blizzard titles, suggesting that Call of Duty might not be as “essential” as Sony claims , until a reiteration of its assurances that it will not make Call of Duty an Xbox console exclusive.
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This is where Microsoft takes a dig at Sony, noting (according to a Google-translated version of its presentation) that for all its concerns about exclusivity, “the use of exclusive agreements has been at the center of Sony’s strategy to strengthen its presence in the gaming industry.”
Microsoft says Sony’s concerns are “incoherent” given that, by virtue of PlayStation’s dominant market share, the company is the leader in digital game distribution, especially when, as Microsoft claims, Sony has actively hindered growth of paying Game Pass. for “‘blocking rights’ to prevent developers from adding content to Game Pass and other competing subscription services.”
Ultimately, Microsoft argues, Sony’s fear is not that the acquisition will hinder its ability to compete, but that Game Pass’s business model of offering “high-quality content at low cost to gamers” threatens a market leadership “forged from a device”. -strategy focused on exclusivity”.
The full document has many more rebuttals to Sony’s claims (including Microsoft’s note that, of all the major industry players the Brazilian government examined for takeover, Sony was the only one oppose) and it is well worth it. a reading
Expect more back-and-forth as the acquisition comes under additional scrutiny from other countries before any regulatory approval. Assuming Microsoft’s purchase of Activision Blizzard doesn’t fall through with regulators, the process is expected to conclude next summer.