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Microsoft and Sony Sign Agreement to Keep Call of Duty on PlayStation
Microsoft and Sony Reach Agreement
Microsoft and Sony have signed a binding agreement to ensure that the popular video game franchise, Call of Duty, will remain on PlayStation consoles after Microsoft's acquisition of Activision Blizzard. The deal comes in response to concerns about Microsoft's potential dominance in the gaming market and its ability to make games exclusive to its own consoles. While the duration of the agreement has not been disclosed, a Microsoft spokesperson has indicated that it is intended for the long term. This agreement is not the first of its kind for Microsoft, as the company has entered into similar deals in the past.
Alleviating Concerns and Fostering Competition
Regulators around the world had expressed significant concern regarding Microsoft's power over the gaming market if the Activision Blizzard acquisition was approved. Sony's CEO of interactive entertainment, Jim Ryan, has also voiced concerns about the potential deal. However, Microsoft's Vice Chair, Brad Smith, has reassured consumers that the company remains focused on ensuring that Call of Duty remains available on multiple platforms and for a wide range of consumers. Despite the positive outlook, the acquisition is not yet certain to close, but both Microsoft and Activision's prospects have improved after a federal appeals judge prevented the Federal Trade Commission from temporarily blocking the deal. Regulators in the EU have already approved the deal, and negotiations with the U.K.'s Competition and Markets Authority are currently underway.
Impact on the Gaming Market
The agreement between Microsoft and Sony to keep Call of Duty on PlayStation consoles signals a commitment to maintaining competition in the gaming industry. By ensuring that a popular game franchise like Call of Duty remains accessible to players on various platforms, it prevents any one company from having a monopoly over exclusive game titles. This move benefits both consumers and the gaming market as a whole, as it encourages innovation, choice, and fair competition. The completion of the transaction between Microsoft and Activision is scheduled for Tuesday, July 18, pending any further regulatory challenges.
Impact on New Businesses
The agreement between Microsoft and Sony to keep Call of Duty on PlayStation consoles has significant implications for new businesses entering the gaming industry. While the deal aims to maintain competition and prevent a monopoly over exclusive game titles, it also poses challenges for new companies trying to establish themselves in the market.
One potential impact is the increased barrier to entry. With a prominent franchise like Call of Duty remaining exclusive to PlayStation, new businesses may struggle to attract players who are loyal to the franchise. This could limit the visibility and market share of upcoming games and make it harder for new companies to gain traction.
Additionally, the exclusivity arrangement may restrict the choices available to consumers. As the popularity of Call of Duty remains strong, players who don't own a PlayStation console may feel compelled to switch platforms to access the game. This could create a higher entry cost for consumers and reduce their willingness to try out games from new developers.
However, it is worth noting that the gaming industry is highly dynamic and constantly evolving. Opportunities for innovation and creativity still exist for new businesses to carve out their niches and develop unique gaming experiences that can attract players. Furthermore, Microsoft's commitment to multi-platform availability for Call of Duty implies that there will still be opportunities for new businesses to reach players across different consoles.
Ultimately, while the agreement between Microsoft and Sony may pose challenges, new businesses entering the gaming industry should focus on developing compelling games with unique selling points and capitalizing on untapped market segments. By understanding consumer preferences and adapting to changing dynamics, innovative new companies can still find success in the competitive gaming landscape.
Article First Published at: https://www.cnbc.com/2023/07/16/microsoft-and-sony-sign-deal-to-keep-activisions-call-of-duty-on-playstation.html