Another eventful day in court has come to a close, with the final day of the FTC v. Microsoft trial set for tomorrow. Surprisingly, today was relatively quiet compared to previous days, as Microsoft CEO Satya Nadella provided mild testimony, Activision CEO Bobby Kotick calmly defended his company against FTC scrutiny, and there was a lot of discussion about economics.
In a delightful moment, Nadella and Judge Jacqueline Scott Corley bonded over their shared love for Candy Crush.
Console exclusivity has been a long-standing practice in the video game industry. However, during the trial, figures like Nadella and Kotick have portrayed exclusivity as a hindrance rather than a benefit, arguing that it limits their ability to do business on certain platforms and reach larger audiences. They claim that they only engage in exclusivity agreements because Sony has forced their hand by paying for exclusive titles like Final Fantasy XVI.
Interestingly, Sony Interactive Entertainment head Jim Ryan took a different stance during his video deposition, stating that he had no issue with Xbox securing exclusive titles like Redfall and Starfield after the Zenimax acquisition. While Ryan acknowledged his dislike for exclusives, he did not view it as anti-competitive. He drew the line at Call of Duty, arguing that making it exclusive would cause significant harm to PlayStation.
It’s challenging to envision a scenario in which making Call of Duty exclusive to Xbox wouldn’t backfire. Losing Sony’s larger market share would significantly impact Call of Duty profits, and the potential backlash from gamers could harm the brand. However, it’s important to consider that Ryan is looking at a hypothetical future where PlayStation is struggling and Xbox is dominant. In that scenario, losing Call of Duty could be devastating for Sony.
Exclusivity may be vehemently opposed when you’re on the losing end of it, but market dynamics are unpredictable. Ryan seems to fear that if Xbox gains the upper hand and exclusivity agreements expire, they may retaliate against Sony, creating more significant challenges. Whether or not this fear is justified will be determined by the court.
During his deposition, Ryan claimed that “all the publishers” unanimously hate Game Pass. However, public opinion on the service seems mixed based on past surveys. While some developers have expressed positive views, others appear to be against it. Bobby Kotick, for example, admitted that he dislikes multi-game subscription services and wouldn’t consider participating in one if Activision remained independent. He believes that such services do not offer a strong enough business proposition.
Kotick’s stance makes sense considering that Activision is currently profiting from individual game sales. Subscriptions would only cannibalize those sales. It’s likely that Ryan was referring to major publishers who are already successful and don’t require the guaranteed returns that Game Pass offers.
In a humorous turn of events, confidential documents were accidentally leaked in court due to a mishap with a redacted Sharpie. These trial proceedings often lead to the exposure of industry secrets, as companies continually make errors when attempting to keep information confidential.
Overall, tomorrow’s conclusion to the trial promises to be an important moment for the future of the video game industry.
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Basant Kasayap is an entertainment aficionado who delves into the glitz and glamour of the entertainment industry. From Hollywood to Bollywood to regional cinema, she offers readers an insider’s perspective on the world of movies, music, and pop culture.
