Sony signs 10-year deal with Microsoft to keep Call of Duty on PlayStation
- Stephen Totilo, author of Axios Gaming
Call of Duty: Black Ops Cold War. Screenshot: Activision Blizzard
The world's most popular annual video game franchise, Call of Duty, will remain on Sony PlayStation for a decade longer, even if Microsoft purchases the company behind it, thanks to a new agreement announced Sunday.
Driving the news: Microsoft and Sony said Sunday that they've agreed on a deal, after more than a year of failed negotiations.
- Few details were available, though a Sony rep told Axios that the arrangement will last for a decade.
Between the lines: The fate of Call of Duty has fueled corporate and regulatory concerns over Microsoft's $69 billion offer to purchase Activision Blizzard, which makes CoD, World of Warcraft, Diablo, Candy Crush and other top franchises.
- Regulators in the U.S., U.K. and Europe questioned whether Microsoft could pull Call of Duty from PlayStation and offer it exclusively on Xbox and PC. That would deny the Sony platform the series that is typically the bestselling game of each year.
- Microsoft has consistently pledged that it would keep CoD on PlayStation and expand it to more platforms, saying that was the most financially fruitful way to manage the series.
- But Sony executives questioned Microsoft's offer and terms. While those concerns were never clearly articulated in public, Microsoft could potentially use Call of Duty to hurt PlayStation even without pulling it, by offering it first or better on its own console (Microsoft has denied it would do this) or by offering Sony an unfavorable revenue split on sales of the game.
Be smart: Sony's agreement with Microsoft comes two days after an appeals court denied what might be the Federal Trade Commission's last opportunity to delay the merger, which was temporarily barred from closing until the end of Friday.
- Regulators in the U.K. have blocked the merger but said last week they would consider a restructuring of the deal and not make their final decision until August.
What's next: Microsoft's Activision Blizzard bid expires on Tuesday, though both sides could agree to extend it.
- Microsoft's purchase of the company will have a significant industry impact, making the company one of the largest employers of game developers of all time and establishing Microsoft as the top third-party publisher on PlayStation.
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