The FTC’s counsel, James Weingarten, says “Activision makes some of the most important video games in the US” with titles like CoD, Diablo, and Overwatch. “Microsoft and its competitors need triple-A content for its consoles... they license Activision content and pay a premium for it.” Weingarten says the evidence the FTC will put forward over the next few days is “a fraction” of the total that can raise anti-competitive concerns.
The FTC and Microsoft both have around 20 minutes each of opening statements before we move on to witness testimony this morning. We’ll be hearing from Xbox Game Studios chief Matt Booty, Bethesda’s Pete Hines, and Sarah Bond, head of Xbox creator experience.
Microsoft has admitted that most Xbox Cloud Gaming users rely on it to try games rather than stream regularly “as a result of technical limitations.” Microsoft is arguing against the FTC today that cloud gaming is merely an addition right now, rather than its own market. This will be a key part of the FTC vs. Microsoft case.
The FTC vs. Microsoft case is starting this morning and Microsoft is keen to show Xbox is in third place. “Xbox has lost the console wars, and its rivals are positioned to continue to dominate” argues Microsoft in a filing today. It also reveals Xbox had 16 percent share of console sales in 2021 and 21 percent of console install base.
Microsoft is battling a key US regulator here, but the real war looks like it will be Microsoft vs. Sony.
The FTC vs. Microsoft case kicks off today and we’re gradually hearing more about Sony’s opposition to Microsoft’s proposed Activision Blizzard acquisition. In a deposition, PlayStation chief Jim Ryan says that Sony would no longer share confidential details about next-gen PlayStation consoles with a Microsoft-owned Activision. “We simply could not run the risk of a company that was owned by a direct competitor having access to that information.”
The FTC case against Microsoft kicks off on June 22nd and we’re starting to get a better idea of the arguments and exhibits that will form part of the court case. Microsoft is planning to submit a bunch of emails, with one in particular standing out thanks to its subject line: “FW: pettiness from Sony and GameSpots fanboy reviewers.” Wow.
