Downplaying one’s size has been a common strategy employed by parties involved in the real-life drama that is Microsoft’s acquisition of Activision Blizzard. Microsoft portrays itself as the underdog against the console giant that is Sony. The latest version of this ploy involves Sony’s hold on the global console market.
Microsoft held a press conference on Tuesday after presenting its argument at the European Commission hearing. According to the tech giant, Sony’s PlayStation has a 70% share of the global console market with Xbox only having 30%.
"Think about the market in Europe. It is a market where Sony has an 80% share," Microsoft President Brad Smith said at the press conference. "Globally, it is about 70/30. In Japan, it is 96/4."
He adds, "These numbers have been remarkably steady for two decades. Even last year, when there were issues with Sony’s supply chain, they came back strong."
Microsoft claims that in 2022, PlayStation outsold Xbox 69/31. However, the Xbox maker did not provide figures for the United States, Microsoft’s biggest market.
Tuesday’s hearing allowed Microsoft to answer the statement of objection that the EU Commission recently sent to the tech giant. The charge sheet warned about the possible anti-competitive effects of the deal between Microsoft and Activision Blizzard.
The Verge’s Tom Warren also reported that Brad Smith said that Sony "can spend all of its energy trying to block this deal... or it can sit down with us and hammer out an agreement that addresses what it says it's concerned about, mainly the access to Call of Duty in the future."
He adds that Microsoft inked two deals with Nvidia and Nintendo in a bid to convince regulators.
"Microsoft thinks its two deals, with Nvidia and Nintendo, will be enough to convince regulators," Warren tweeted. "Smith on the CMA: "Do you want to kill a deal and cement Sony's position? Or do you want to open this [Call of Duty] up to 150 million more people?"
Microsoft thinks its two deals, with Nvidia and Nintendo, will be enough to convince regulators. Smith on the CMA: "Do you want to kill a deal and cement Sony's position? Or do you want to open this [Call of Duty] up to 150 million more people?" pic.twitter.com/S1M3bmqEY5
— Tom Warren (@tomwarren) February 21, 2023
Microsoft announced a legally binding 10-year agreement with Nintendo to bring Call of Duty to the console. According to Smith, the agreement will bring Call of Duty to Nintendo players on the same day as Xbox and with full feature and content parity.
It will be interesting to see how Microsoft intends to pull this off given Switch's age, struggling to run native games such as Pokémon Scarlet and Violet. It will be hard to imagine that Activision can develop a game that runs well on PC, consoles, and handheld. Most likely, the deal will be delayed to a later date once Microsoft closes the Activision Blizzard deal or when Nintendo comes out with its next console, preferably both.
At the same time, Microsoft finalized a 10-year partnership with Nvidia to bring Xbox games to GeForce Now if the deal is approved.
Ironically, Nvidia was among those with Google that voiced its concern over the merger.
Microsoft also gave an update on the deal it offered Sony for the Call of Duty franchise. "We haven’t agreed a deal with Sony, but I hope we will," Smith said.