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Comment by wilg | Hacker News Reader

I think so. Nobody I know has an Xbox, even though we all had Xbox 360s back in the day. But they all have PS5s because Sony has great exclusive games. I don't see why Microsoft shouldn't be able to buy Activision, exclusives would be very helpful for them becoming competitive. But I don't play many (any?) Activision games so it wouldn't really move the needle much for me.

It is interesting the US is trying to block the last place player in the market from growing, which is also the only US company in the market.

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> I don't see why Microsoft shouldn't be able to buy Activision, exclusives would be very helpful for them becoming competitive.

Because acquisitions make markets less competitive, not more. There are a zillion US companies making games, and if the platform gatekeepers become an issue, then the US can force them to open up their platforms and quit their rent-seeking.

> Because acquisitions make markets less competitive, not more.

This is just simply not true as a blanket rule.

Also, I don't understand what you're saying. Activision is not in the console market, only Microsoft is. Buying Activision makes the console market more competitive because it makes Microsoft's console more compelling in that market, a market where they are floundering.

You could also look at the game market, which as you say has a zillion US companies making games, and Activision under Microsoft would have to continue to compete in that market.

How does this reduce competition, and in what market?

> This is just simply not true as a blanket rule.

It is, which is why the FTC needs to approve mergers.

> Buying Activision makes the console market more competitive

Why should the FTC care about the console market specifically rather than the gaming market in general?

> How does this reduce competition, and in what market?

The very notion of "console exclusives" reduces competition because it removes incentives to compete on hardware cost or quality and instead compete only on whatever IPs a company happens to own.

> It is, which is why the FTC needs to approve mergers.

It isn't, which is why the FTC often approves mergers.

> Why should the FTC care about the console market specifically rather than the gaming market in general?

They should consider both.

> The very notion of "console exclusives" reduces competition because it removes incentives to compete on hardware cost or quality and instead compete only on whatever IPs a company happens to own.

Why is competing on hardware cost or quality more valid than competing on exclusive content? And if that's the rule, why is the company with better exclusive content, Sony, allowed to acquire more studios, like Bungie?

How is Sony holding their "first party games" (which were all made form company acquisitions, just years ago) from Xboxes not literally the same thing as M$ purchasing Activision and blocking them from PlayStations?

Both are 1) buying a game making company, 2) making a game, 3) withholding it from the competition.

Sony's purchases were generally smaller individual studios that didn't have big libraries of existing established IPs?

There doesn't seem to be many examples of them buying studios to take existing cross platform megahits exclusive.

Edit: They apparently bought Bungie recently? Wikipedia kinda doesn't include it in their list of PlayStation studios in a normal fashion so I missed it. I suppose that is buying a big IP in Destiny (in reaction to the MS-AB takeover?), although that's basically a 1 game studio (next to no-one is really going to care about Myth or Marathon), so it's still a fair bit smaller than the sort of stuff proposed with MS and A-B.

Most of the studios Sony bought were “2nd party” - i.e. they predominantly made games only for PlayStation. The effect on competing consoles was minimal - their game never made it to non-Sony consoles anyway; this was a different era where porting games was very painful since the hardware can vary radically between consoles.

It is the same thing. The biggest player (if you include Windows gaming) in the market gets treated differently than the second biggest player.

Many may not like it but it is not about what is fair, but what keeps the market healthy.

>if you include Windows gaming

But windows gaming isn't like console gaming. You don't have to pay license fees to microsoft to publish on windows - its a general purpose platform thats relatively open. It has nothing to do with the console market for you to count it except to purposely misrepresent the market.

You are having a different lens. If you focus on what Microsoft could do (enforce Apple like rules) not what they are doing right now you will understand the regulators better. It’s just about making sure the biggest player has competition.

> It is, which is why the FTC needs to approve mergers.

It would make Microsoft more competitive/powerful

> Nobody I know has an Xbox, even though we all had Xbox 360s back in the day.

Yes, because no one you know has an XBox, it obviously means that Microsoft isn’t selling any…

Objectively they are selling significantly less than the PS5. And subjective estimates put it at 1 Xbox for every 2 PS5s at best, but it's most likely a bit worse.

Sony built its library of exclusives. Microsoft is trying to just gobble up the biggest studios not already owned by a console manufactuerer. That's blatantly anti-competitive.

Let's not act like both companies haven't bought up every independent studio they can get their hands on. Hell Sony just bought Bungie in a multi billion dollar deal.

IMO the only of the big 3 that can truly be said to "built is library" is Nintendo.

Insomniac I can understand. The company has a lot of history with Sony.

Bungie is puzzling. Frankly, I’m not even sure what’s there to buy. All they got is Destiny that’s a pretty so-so game popularity-wise.

Who else has Sony bought?

Naughty Dog, Media Molecule, Guerrilla Games, Sucker Punch.

https://en.wikipedia.org/wiki/PlayStation_Studios

I meant recently. Those are ancient history - most of them have history with Sony before being acquired.

Why does that matter? Early bird gets to buy the worm? Is it less anti-competitive if we forgot about it?

Because we are talking about the companies’ behaviour today? MS is trying to buy one of the biggest publishers right now.

Secondly, most of those game studios already have a close relationship with Sony, they can be considered 2nd party, and mostly make PS games. Sony’s competitors aren’t losing out much.

P.S. Frankly, I don’t think Sony ever intended to be in the game development business - they are a hardware company. There is a pattern to the game developers they buy - almost all of them are “tech wiz” developers; i.e. optimisation gods while gameplay of their games are usually so-so. The raison d'être of their acquired studios are to showcase the power of their hardware and coincidently provide development tool chain feedback as well as development knowledge which Sony’s “ICE team” will then share with other developers, not compete with their 3rd party developers.

That said this might have change in recent years as exclusives become a differentiator for their console.

Speaking about the origin of Sony PlayStation divison (Sony Computer Entertainment), it was derived from Sony Music. Its origin was a content company than a hardware company.

Going to need a citation for that.

The PlayStation all started with Ken Kutaragi who worked in Sony’s digital research labs. It started as the “Play Station” a CD addon for the SNES. But due to contract disputes Sony got dumped for Philips in a very public fashion - probably Nintendo’s biggest mistake ever. Sony went ahead on its own and created the “PlayStation” (aka PS1 today) and the rest is history.

Don’t see where Sony Music comes into the story.

That's true that Kutaragi was the biggest person (and PS won't happen without him) on SCE from hardware. But SCE corporate was also made by Sony Music people. First president and vice president were from Music. So it wasn't quite "hardware company" from the beginning. You're true that the "origin" (SNES sound chip and CD-ROM) was just a hardware. I read Japanese articles like this. https://otocoto.jp/column/utsumi02/ https://www.sony.com/ja/SonyInfo/CorporateInfo/History/SonyH... https://www.dreamincubator.co.jp/bpj/2014/07/16/sony02/

All of these had existing relationships with Sony and made PS exclusives anyways (i.e., so-called 2nd party studios).

The Bungie purchase isn’t puzzling if you look at Sony’s future trajectory. They have 10 or so live-service titles in development, and have stated very openly that they aim to greatly expand their offerings in that area going forward. There are only a handful of studios that have created successful live service games and even fewer that haven’t leant on popular existing IP (such as Call of Duty: Warzone) to do so, Bungie (and Epic) are pretty much the pioneers in this space, and Bungie have learnt a lot from their trials cultivating the Destiny franchise.

Sony purchased Bungie to essentially teach them how to make successful live service games, not for the IP. They hold so much power inside PlayStation studios that they, as per the recent The Last of Us factions leaks, review and determine if a multiplayer title meets their requirements for success (factions didn’t).

I don’t think it’s a good thing (as I personally disapprove of the way Destiny operates & see a focus on these sorts of games from Sony as a major blunder) but the business logic of the purchase is obvious.

Destiny 2 has the 20th most concurrent users on Steam right now and had 300k+ concurrent players after the last $30 expansion, its by all rights a very successful game within the live service RPG space.

Why is building them internally more anti-competitive than acquiring them externally? They were never competing with Activision.

They built it off of companies they bought when they were 4/10 big, and they bought like 30. Microsoft is buying like 5 10/10 big companies and everyone starts freaking out.

Ahh yes, the THQ Nordic/Embracer Group approach. Works everytime if you slowly buy companies that made that one smash hit 10 years ago and was forgotten about. Genius business move.

Sony made Final Fantasy?

And here I am reading that Sony just purchased Bungie for $3.9 billion…

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