According to a new report published by The New York Times, Microsoft offered Sony a 10-year deal to keep Call of Duty on PlayStation earlier this month. That is substantially more than the previously proposed binding agreement, which Sony Interactive Entertainment boss Jim Ryan said only covered three years (beyond existing contracts) and was inadequate on many levels.
It’s all part of Microsoft’s ongoing efforts to persuade regulators (mainly in the US, EU, and UK) to let the $69 billion Activision Blizzard deal be completed. Both EU and UK regulators recently expressed concerns that Call of Duty’s potential exclusivity could create unfair advantages for Microsoft, mainly in the subscription and cloud gaming markets. Both regulators have also now begun deeper reviews of the deal. According to the NYT report, the US Federal Trade Commission is reviewing the deal with over ten staff members, who interviewed Microsoft executives like CEO Satya Nadella and president Brad Smith. Additionally, sources say the FTC has now asked other game companies to provide sworn statements on their potential concerns, which may indicate that the FTC is preparing to fight the deal. On the other hand, as far as we’ve seen, the only company openly opposed to Activision Blizzard joining Microsoft is Sony; some, like Take-Two, actually spoke in favor of the deal going through.
Sony is doing everything it can to stop the deal, though. They’ve been making the case that Call of Duty is irreplaceable for a few months now, and in a brief statement to the NYT, Jim Ryan said Microsoft is a tech giant with a history of dominating industries, making it highly likely that the choices gamers have today will disappear if this deal goes ahead.
Microsoft, for its part, is fighting back. While Gaming CEO Phil Spencer claimed it would be impossible for him to sign a contract that promised Call of Duty would stay forever on PlayStation, he also stressed it would not make any business sense to remove the franchise from Sony’s consoles; in fact, he would like to bring it to Nintendo platforms, too, treating it like they did with Minecraft. Spencer then stressed the Activision Blizzard deal is not at all mainly about Call of Duty on consoles; rather, it’s about expanding Microsoft’s presence on mobile, chiefly with King’s products (Candy Crush, for example). Without it, the whole gaming business could become untenable, given mobile’s growing importance within the market.
Call of Duty’s recent record-breaking numbers may not help Microsoft’s argument, however. Modern Warfare 2 earned $1 billion in the first ten days since its release, and Warzone 2.0 already registered 25 million players (not to mention record Internet traffic) in the first five days since launch.