Microsoft Corp. and Nintendo Co. agreed to a 10-year deal to bring Call of Duty to Nintendo gaming platforms, signalling a willingness to share one of the game industry’s most important titles at a time of growing consolidation in the industry.
The agreement depends on Microsoft closing its $69 billion acquisition of Activision Blizzard Inc., the Redmond, Washington-based company said.
The blockbuster merger is facing close scrutiny from regulators in the U.S., Europe and elsewhere. Microsoft, maker of the Xbox game console, faces resistance from Sony, which makes the competing PlayStation console and has raised concerns with antitrust watchdogs about losing access to what it calls a “must-have” game title.
According to The New York Times, many in the video game industry expect the US Federal Trade Commission to discuss the acquisition in a closed-door session scheduled for Thursday. The commission could vote on whether to file a lawsuit in an effort to block the deal.
Regulators are primarily focused on concerns that consumers would be harmed if Microsoft withheld Activision’s games from competitors or unfairly leveraged Activision’s popular titles as more video games were streamed online.
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Microsoft said it is committed to expanding the number of platforms on which people can play games, Xbox chief Phil Spencer told Bloomberg News. Microsoft also said it’s committed to offering Call of Duty on Valve Corp.’s Steam platform at the same time as it’s released on Xbox.
The company has extended a similar offer to Sony Group Corp., to bring the famous Activision franchise to PlayStation consoles for a decade, but that has so far been rebuffed by the Japanese company, Spencer said. Sony has fiercely objected to the Activision acquisition, primarily because of concerns the US tech giant could make content like Call of Duty exclusive to its own gaming services.
“Our intent is to become more relevant on more screens,” Spencer said. “We have a pretty good idea of how to build a win-win relationship with Nintendo and frankly Sony.”
Nintendo shares in Tokyo erased losses on the day and were up as much as 1.5 percent after the announcement. Sony widened losses to as much as 1.2 percent.
A Sony Interactive Entertainment spokesperson declined to comment.
Spencer remains confident that Microsoft’s Activision takeover will be approved by regulators, with the company setting a timeline of getting that deal done by the end of its fiscal year, which is in June. He sees the steps taken by Microsoft with Nintendo and Valve — assuring them of the prized asset for their competing gaming platforms — as a signal of Microsoft’s push to be inclusive and distribute its portfolio of gaming content widely.
Microsoft executives are set to meet with US Federal Trade Commission Chair Lina Khan and other commissioners Wednesday to make its final case in support of the deal.
“There’s been one game industry participant that’s really been raising all the objections, and that’s Sony, and they’ve been fairly public about the things that don’t meet their expectations,” Spencer said. “From where we sit, it’s clear they’re spending more time with the regulators than they are with us to try and get this deal done.”
Outside of Sony’s objection to the Activision acquisition, Microsoft has seen “a lot of support from the industry,” he added.
First Published: Dec 7, 2022 12:32 PM IST
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