Xbox FTC Trial Day 4: Bobby Kotick and Jim Ryan Agree on One Thing – Neither of Them Like Game Pass

Another busy court day begins tomorrow as the FTC v. Microsoft trial is set to conclude tomorrow. It was a surprisingly quiet day compared to some previous days, with Microsoft chief Satya Nadella giving a relatively benign testimony and Activision CEO Bobby Kotick speaking to the FTC. He calmly parried the interrogator, and there were many stories of economists.

We also got a glimpse of how Nadella and Judge Jacqueline Scott Corey bond over their mutual love for Candy Crush. fun.

Exclusive to me, but not exclusive to you

Console exclusivity has been part of how video game releases work effectively since they were born. But as Xbox and its friends have been hearing the story over the past few days, everyone in the industry loathes the idea.

Figures like Satya Nadella, head of Microsoft, and Bobby Kotick, CEO of Activision, today make exclusivity feel more like a bug than a feature, do business on specific platforms, and serve larger markets. ruined the ability to reach For example, Nadella said he had “no love” for exclusive games, while Kotik stressed that making Call of Duty an Xbox exclusive would be “very detrimental” to the business.

These are all consistent with Spencer’s comments. Collectively, Xbox and its witnesses and lawyers seem to argue that the whole notion of exclusivity is abhorrent and that Sony coerced it so they go along with it. They argue that if Sony stopped paying for exclusive games like Final Fantasy XVI, Xbox wouldn’t have to sign deals like Activision just to compete.

It’s also not shocking that Sony Interactive Entertainment head Jim Ryan sang a decidedly different song in a video affidavit yesterday. He said he “didn’t like” Redfall and Starfield becoming Xbox exclusives after the ZeniMax acquisition, but “had no objection to it” and didn’t consider it anti-competitive. Despite Xbox already sharing data in court that his PlayStation’s own exclusives far outnumber Xbox’s, Ryan can’t take a lofty stance on exclusives. Where he draws the line, of course, is Call of Duty. The series is so massive and successful that the very idea of ​​going exclusive (which the FTC and Sony claim) is considered to do PlayStation irreparable harm.

At this point, it’s admittedly pretty hard to imagine a scenario where Xbox wins an exclusive Call of Duty title without major backlash for Xbox. The loss of Sony’s much larger market share would slash existing Call of Duty profits, and (as multiple executives have pointed out to us) this hypothesis ignites a “passion” in gamer audiences. ” can cause serious damage to your brand. But one important thing to keep in mind is that in a very similar market situation, Ryan thinks Xbox will have a Call of Duty exclusive launch next week, this month, or next year. It means no. Rather, Ryan believes that the tables will truly be reversed, meaning that PlayStation is already at the bottom for some reason, and that in a hypothetical distant future, like Xbox is now, he believes Call of Duty will cease to exist. seems to be afraid of

PlayStation certainly reigns supreme in the world, and they can do just fine without Call of Duty. But Ryan knows this situation won’t last forever. In the online “console wars,” there are real sales winners and losers. PlayStation may be confident in its plans for the next five or even ten years, but Ryan fears Spencer’s Call of Duty promise will expire at some point. there is And when that happens, Call of Duty’s loss could be devastating if Sony isn’t already at the top of the console world.

When exclusivity is a winner’s tool and we are losing, it makes sense to vehemently oppose exclusivity. But markets are unpredictable. There is no way to guarantee what position either competitor will be in ten years from now. Ryan said that if he wasn’t on top when those deals expired, Xbox would do to Sony exactly what Sony has done to Xbox for years, or better. seems to believe that it will be even worse. It is up to the court to decide whether his belief is correct.

Microsoft Acquires Activision Blizzard: The Story So Far

Eurogamer Report 2019 polled developers on their thoughts on Game Pass, and the results were much more mixed than Ryan characterizes. But that was four years before him, and the survey was mostly mid-tier developers, not big publishers.Mike Rose of No More Robots I have recently thought Much more positively biased when it comes to service, but he’s just one example. Speaking of Xbox, the service is great for developers, but it’s also admitted to cannibalizing entire game sales. All in all, public evidence that companies are talking about Game Pass sentiment seems to be pretty much everywhere. So what was Ryan talking about?

From Bobby Kotick’s testimony today, we can speculate that he seems to hate Game Pass as much as Ryan does. When questioned, he admitted that he’s not a fan of multiple game subscription services, which explains why he didn’t see Activision’s games (for the most part, if not completely) on the subscription service. The reason is that While he doesn’t have a clear internal policy against listing Activision games on the subscription service, he believes he has strong enough business incentives to convince Activision to join the subscription service if it remains independent. I emphasize that I do not believe there is a proposal for

While we disagree with the idea of ​​a multi-game subscription service as a business proposition going forward, we [Activision and Microsoft] you can agree or disagree

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He acknowledges that if the acquisition goes through, he will continue to use Game Pass, whether he likes it or not. “While we disagree with the idea of ​​offering a multi-game subscription service as a future business proposition, we [Activision and Microsoft] You can agree or disagree,” he said.

It makes a lot of sense that Kotick dislikes multi-game subscription services in principle. He has no intention of profiting from them. If Activision is currently selling millions and making $70 a copy, why would he put Call of Duty on Game Pass? What does a Diablo 4 subscription mean? It makes business sense to guarantee the return of But Activision Blizzard games have reached a level of popularity that no longer needs to be. It’s the same reason GTA 5 was only briefly available on Game Pass ten years after its release. You don’t need to. Subscription contracts only hurt sales.

So back to Jim Ryan. Game Pass is likely to be a very good deal for developers who want the financial guarantees Game Pass offers, as sales prospects are sufficiently uncertain. But Jim Ryan probably wasn’t talking to Mike Rose, Tequila Works, or any of the other developers Eurogamer spoke to. I think Jim Ryan is referring to big publishers that don’t need Game Pass. The reason is that they either have their own service (EA or Ubisoft) to distribute their games, or they are Take-Two, Activision Blizzard or even Nintendo. Guaranteed revenue for the set in exchange for every unit sold would be sheer stupidity.

leak in boat

Before I leave today, I would like to make a small digression. Perhaps the most interesting revelations today didn’t actually happen in court. It happened because a lawyer or assistant, or someone, didn’t look carefully enough at the mechanical pencil they were using to edit a highly confidential document.

Lawsuits like this one are a heyday for the gaming media, not just because of what a normal lawsuit reveals, but because a highly secretive game company has done a wonderful job of keeping things like this under wraps. Because they keep doing it, and as a result, they’re just throwing a pile of secrets into their evidence folders. Aside from the Sharpie disaster above, we saw an entire presentation last week containing secret details about a company that Xbox wanted to acquire, but which has since been pulled out of a folder and has much more features. replaced by another version with There were huge black edit boxes plastered all over the place. I expect more of the same to happen tonight and tomorrow as the entire evidence folder is offline after the Sharpie incident.

All of these are very interesting, but they have more important implications. Judge Jacqueline Scott Corey has scored well on all of these issues, but in this case as well as in Epic v. Apple, the U.S. judicial system recognizes the protection of legitimate trade secrets, but not trade secrets. We make it clear that we are not here to do PR. video game company. When game companies go to court over something of this magnitude, they inevitably win the win for consumers through the strange form of corporate transparency. The more they fight, the more we learn.

The court has one more day left, and a ruling is expected in the next few days. You can check out our daily roundup here at IGN for a daily update on everything happening with the FTC vs. Microsoft. You can also check out a detailed analysis of his 1st, 2nd and 3rd day before the trial. We will meet again tomorrow.

Rebekah Valentine is IGN’s Senior Reporter. you can find her on her twitter @duck valentine.