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Comment by darknavi | Hacker News Reader

Microsoft employee here, opinions my own.

I work in gaming at Microsoft and I really enjoy it. I think Microsoft gives us a ton of space to explore and make our own impact and I am a huge fan* of Phil Spencer.

> Microsoft’s acquisition of Activision has been described as the largest in tech history. It deserves scrutiny. That scrutiny has paid off: Microsoft has committed in writing, in public, and in court to keep Call of Duty on PlayStation for 10 years on parity with Xbox.

How does this make anyone feel any better? What happens after 10 years? Microsoft has been around for 4x that long.

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> How does this make anyone feel any better? What happens after 10 years?

What happens in less than 10 years if they don't abide by it?

Does Activision get split back out? I doubt it.

We're long past the point where you can just set rules/laws and companies will abide by it. We need to be at the point where we also list the punishment ahead of time.

You mean like Facebook/WhatsApp which committed to not do some things and that certain things aren't even technically possible (which even back then was a lie) to get the merger through in the EU and then a few years later was, oh that, yep, let's ignore it and just turn it into a long legal battle which will anyway cost us far less then what we gain from it.

what has fb gained from whatsapp? theyre not charging for it right?

The phone contacts and social graph of everyone using WhatsApp.

One big competitor less to worry about

Depends how good Sony's lawyers are. Theoretically the courts could offer an injunction preventing sale of the CoD until it is also available on whatever equivalent Playstation type system there is.

Sony vs MS lawyers... that would be messy... and fun to watch. grabs popocorn

Would they just build a COD that is dependent on specific MS tech so they cannot release it on competing systems? Why not try and rebrand Call of Duty so that it isn't in violation? Just call it 'Duty'. It starts to get very grey very quickly.

Most likely a fine far less than the money gained from not abiding by the law, if history is anything to go by.

> What happens in less than 10 years if they don't abide by it?

Likely nothing. I don't understand why people believe in these things.

> We're long past the point where you can just set rules/laws and companies will abide by it.

What's the rule / law here anyhow? There are always workarounds, e.g. it says it will keep it in parity with xbox... well what if they called a new console something else?

> Likely nothing. I don't understand why people believe in these things.

No kidding. They could just introduce a new game franchise called "Duty of Call - Warfare That's Modern" and make that Xbox exclusive instead. Or any number of other workarounds and sneaky tactics.

You know that Sony could just agree to a contract with microsoft over this right?

If they write up a contract with penalty provisions, this could able be guaranteed through civil court.

It is not some crazy unsolved question as to how to get a company to commit to something in the future.

> Likely nothing. I don't understand why people believe in these things.

Likely Sony will take them to the cleaners.

that's not a bad idea, laws without punishments are kind of ambiguous I suppose. I wonder the utility of leaving this open, is it tantamount to mandatory sentencing and takes freedom away from the judge or something like that.

> We're long past the point where you can just set rules/laws and companies will abide by it.

We're not, but this is pretty nebulous stuff. The state blocking freely agreed transactions because it can foresee some damage is not exactly a clear cut good, other than for people who are reassured by the idea of the state as a benevolent, all-knowing mom and pop, and for the lawyers who get paid a fortune to debate past and future hypotheticals.

What about this: allow the merger, and if the harm is done, the company must pay, but if the harm is not done, the state must pay?

> What about this: allow the merger, and if the harm is done, the company must pay, but if the harm is not done, the state must pay?

The FTC identified not having CoD on multiple platforms as a large issue. What payment is justified if Microsoft doesn't allow CoD on multiple platforms?

It's easy to say "if harm is done, the company must pay" but look how long we've know leaded gasoline was harmful, look how long we've know abestoes was harmful, look how long we've know pfas was harmful, look how long we've know cigarettes are harmful. And then look how long it took for any company to pay after fighting tooth and nail saying it wasn't harmful despite their _own_ internal research saying the contrary.

Sure, CoD is not in the same scope as leaded gasoline. The point still remains, a harm has been identified and I don't think they should be allowed to merge so long as the punishment for that harm occurring isn't pre-determined.

>The FTC identified not having CoD on multiple platforms as a large issue.

What perspective has been applied to this?

toy soldiers gotta be trained

Because if there is harm the companies pay so little it's just written off as cost of doing business. Yet the harms too often continue.

Companies with more resources than small countries are often too big to regulate because they capture the regulators and/or the judiciary.

Prevention is cheaper than treatment, especially when treatments have proven so ineffective.

> Companies with more resources than small countries are often too big to regulate because they capture the regulators and/or the judiciary.

Regulatory capture is entirely the fault of the regulator. They don't have to be captured. They choose to be. A government body, funded by taxes, that decides to be captured, is a complete disgrace. People work hard to pay taxes, and they shouldn't be spent on employing people who choose to align with those they should be regulating.

> Prevention is cheaper than treatment, especially when treatments have proven so ineffective.

The same state that has the power to prevent has the power to treat. It chooses not to. Switching approach won't help. Getting regulators to do their jobs will.

I wish it were that simple. Sadly a large portion of US voters seem to think a revolving door with "industry experts" (i.e. insiders) is desirable. And that courts should defer to business interests above all else.

‘Running the government like a business’ is and was the biggest crock of shit ever sold.

Anyone who has worked at large corporate bureaucracies knows they are just as slow and rule bound as government departments and in many ways worse. At least there are some well motivated people in government.

Government is us. The people. We’ve delegated it to an elite class that gets more and more cut off from the common politik as time goes by.

I see no easy solution . Power does not willingly give up power.

I don't think any solution here we've mentioned is simple. I don't think you should be characterising only the ones I'm mentioning as being not simple.

The state blocking freely agreed transactions because it would allow someone to create something larger and more coercive than the state seems like a good minimum.

We don't have to debate past and future hypotheticals - that's an invention of the "consumer welfare" theory of antitrust. The one that said it's entirely fine for, say, Apple to have a monopoly on iOS software as long as they have a prosocial justification for it. Apple's specific argument is that their monopoly protects from malware... or, in other words, they're big enough that they can make and enforce their own laws.

A better and simpler rule is this: being big is illegal, period. That's how antitrust used to work. If a business deal would give you the capability of becoming your own sovereign state, you don't get to execute that deal. If you knock out all your competition, we break you up into competing companies.

This is the sort of thing that triggers free market types, I know. My argument is specifically that large businesses get to write their own rules, and the only way to prevent them from doing that is to make them small enough that they cannot execute political power equivalent to that of a monarch. Right now, we live in this comedic parody of free market liberalism where the business owners have centralized power to themselves, turning themselves into de-facto states, and gotten the de-jure state drunk on surveillance tech to avoid scrutiny.

Why would you be a huge fan of the man who’s single handedly responsible for sinking the Xbox IP ship to the point of having to monopolize the industry to right the ship?

I’m surprised people didn’t wake up with the One era lies he kept pushing, and given HNs general distaste for “marketer talk”, how can one be a fan of a dude that every time he opens his mouth, it’s marketing talk (when it’s not a lie). This dude would constantly say shit like “the console wars are stupid. We need to all get along”. And then when pressed about “hidden DGPU” that he knew didn’t exist, he lies and responds “we are not letting Sony have a hardware advantage”. This dude is a scumbag.

He’s been terrible for Xbox, and now his horrid management of Xbox has led to being terrible for gaming in general.

Big fan? Nah.

You're thinking of Don Mattrick.

I am most definitely not, Mattick was Mr “we have a console for that, the Xbox 360” ultimately leading to Spencer taking his role over. Spencer was 100% the dude saying “we’re not letting Sony have a hardware advantage” although I may have mixed up which obviously bullshit Xbox fanboy excuse it was about.

None of it really matter though, because even forgetting Phil obviously constantly fanning the console wars, he’s presided over Xbox for what like 10 years? In that time, what he’s managed to do is be a baby, and complain that his ineffective management is leading to their console having no games.

Yeah. Looking at past form, after the MS anti-trust agreement in the EU expired (the browser choice one), MS have now gone all-in to force Edge down everyone's throat.

They're clearly "Ok, we have more room to legally get away with XYZ now so LETS GO FOR IT!!!!".

MS is the definition of a Slippery Slope in action.

The judge considers it reasonable because if the market is as the FTC defines it and if Call of Duty is actually an essential input for a competitor in the "high-performance gaming console" space, then those commitments from Microsoft give Sony ten years to innovate and come up with a replacement for CoD. It makes a lot more sense if you read the whole judgement, Judge Corley is basically saying "Most of what the FTC is asserting is questionable, but even if we assume that their assertions are correct, the argument to temporarily prevent & potentially permanently ban the deal to prevent harm there is little evidence for is not strong enough to harm Microsoft and Activision in this way". There's other stuff that had some impact as well, like how the FTC knew the deals deadline (six days from now) more than a year ago, but only chose to bring the PI motion recently, giving Microsoft barely any time to prepare (and making the federal judge in this case have to work some unusual hours, including the entire weekend, because it's now so time critical). Basically, a lot more went into this decision than just the ten year agreements.

> I am a huge can of Phil Spencer

I'm sure Phil Spencer will be interested to know that he can fit into a can :)

I AM a HUGE can of Phil Spencer lmao. Fixed.

in 10 years I fully expect Sony to have a competitive first party title exclusive to playstation, now that they actually have to give a damn. I love the killzone series but Guerilla seems to be doing fine with Horizon, hopefully a new IP

In 10 years Sony… I don’t think Sony is intending to go all out on gaming going forward. They’ve been figuring out how to cross pollinate their IPs into media productions. It certainly will make them more money in the long term but some people might be turned off with how much they milk each franchise before moving onto a new IP. Naughty dog is working on LoU3 and Guerilla is working on Horizon Remaster, Horizon Multiplayer and supposedly a non horizon game..

I wish they would bring SOCOM back.

that would be so awesome, Socom was my absolute favorite game on the PS2 and there hasn't really been anythign to capture that same magic since

> How does this make anyone feel any better? What happens after 10 years? Microsoft has been around for 4x that long.

"The slow blade penetrates the shield."

A bit of a loaded question, but how do you feel about xbox f-in up major titles like Halo Infinite and Phil Spencer just saying "yep, we are sorry, that's on me". When a) there doesn't seem to be any change in quality assurance (see Redfall) and b) the devs still take the hit (see 343).

To me it's incomprehensible how they managed to f-up Halo Infinite, then just stand there in silence and then say, yeah we are sorry for not having a lot of interesting titles on Xbox, but here's what's coming next year.

If I were a game dev at Microsoft, I'd be furious!

It would be incredibly stupid for MS to make CoD an xbox exclusive and completely misses the business case for buying Activision in the first place.

Remember, MS is in business to make money, not to win the console wars. Buying the CoD (etc) IP at an inflated price and then immediately cutting off more than half of the revenue would be so mind-boggingly stupid, almost to the point of malpractice. This is why they really don't even need to be forced into saying they'll maintain it for 10 years on PS.

It's all about moving gaming to a recurring revenue model. So you don't care about if the consumer made a one time purchase of your console (in fact, you might even prefer they didn't if you're losing money on each one!), but you do care about the fact that they're playing your games.

Ben Thompson put it better than I could:

> Notice that this is for games that are purchased, and keep in mind that Microsoft’s goal with the Activision acquisition is not to gain exclusive games to sell but rather games to subscribe to. As I’ve argued the only way this acquisition makes sense is the extent to which it makes possible a new business model for gaming; simply buying exclusives via established titles like Call of Duty would be hugely value destructive.

>What is notable about Microsoft’s subscription push is that it aligns the company’s Xbox division with Microsoft’s overall push towards cloud computing and subscription services. What is interesting to consider are two questions:

>First, would Microsoft have ever gone down this path absent the investment in its original (failed) Xbox strategy? I would argue the answer is no; this is a reasonable leveraging of Xbox assets, but I do wonder if Microsoft could go back two decades if they would even bother.

>Second, if regulators were to kill this deal (Microsoft still needs approval from the UK and the US) would Xbox be long for this world? It’s hard to see how the division makes sense if Microsoft has the current business model dictated to them, given just how dominant Sony is with said business model.

https://stratechery.com/2023/uk-blocks-microsoft-activision-... (paywalled)

Non-"here's my theory as to why this would never happen" counterpoint: they bought Bethesda and made Starfield MS platforms-only.

The following is personal opinion based on publicly available figures, IDK how accurate they are.

Skyrim has supposedly sold around 60 million copies over the span of 12 years. Let's be generous and say those sold at an average of $60 each (probably less in practice due to sales, etc.)

That's $3.6b USD in raw revenue. Pretty sick!

On the other hand, as of 2022 (Skyrim numbers are 2023), Call of Duty as a franchise had generated over $31b USD in raw revenue. 10x that of Skyrim, Bethesda's biggest title.

So in terms of scale, I don't see how making Starfield exclusive can possibly be on the same level as the idea of making the whole CoD franchise exclusive. Certainly it would be impactful but I can understand treating them differently.

Thanks for the reasoning.

My disagreement would be that you're comparing an installment with a franchise. The whole of the Elder Scrolls is bigger than Skyrim, although Skyrim was the biggest standalone seller. Elder Scrolls online has I think about 750k MAUs, at $10-$15/mo.

And, I suppose more fundamentally, why would MS turn down a good chunk of $3.6b for the dev costs of making a Playstation version of Starfield?

>My disagreement would be that you're comparing an installment with a franchise.

funny thing is that if you compared the last 15 years of COD to Elder scrolls, you're still comparing some dozen COD games to Skyrim and ESO. And I guess that one mobile game? 15 years ago is still a year after Oblivion launched.

You don't just cut it off in a single go, Microsoft make their platforms more enticing. Heck they can do game companies used to and have timed exclusive releases. COD dropping on Xbox 2 months before anyone else.

Microsoft are REALLY good at playing the long game.

If MS doesn't care about winning the console wars why don't they just stop making Xboxes entirely?

Microsoft's subscription push can't work without winning the console wars since Sony isn't about to let them put GamePass on PS since that kills Sony's revenue model. (That would itself be a very interesting antitrust case.)

So they still want to win the console wars, they just want to monetize that victory differently. But pulling things like Starfield - and eventually COD - off of other platforms is 10000% still aligned with "making as much money as possible."

Because they want to sell their games without paying a 30% cut to someone (Sony/Nintendo/Valve/Apple/Google/etc) if possible. Also getting the 30% cut from someone else selling on their platform is really nice.

Because game studios prefer to target fix hardware like game consoles instead of the computer hardware jungle.

>why don't they just stop making Xboxes entirely?

because at this point, even if Xbox's weren't profitable, ending the Xbox brand would harm confidence in Gamepass.

Not that Xbox isn't profitable. But even in the worst case they have negative incentive to pull out.

You don't just cut it off in one go, you squeeze them out slowly.

Embrace the business (with money), extend the functionality (Xbox exclusive features), Extinguish the competition (drop support).

> It would be incredibly stupid for MS to make CoD an xbox exclusive and completely misses the business case for buying Activision in the first place.

So why are Redfall and Starfield Xbox exclusives? Wouldn't they make more money by releasing them for Playstation too?

The economics are different: Redfall isn't a huge name, so it's more valuable for MS to get people into the game pass subscription than the comparatively piddly incremental one-time revenue they'd get from releasing it on PS5.

CoD on the other hand is already a huge name, that releases every year (i.e. recurring revenue, even if it's not a subscription per se), and MS is paying a huge premium for it. Forcing people over to game pass in that case isn't worth taking the hit to reliable revenue you're virtually already guaranteed to get from PS owners.

To be clear: I think it's less important to worry about this as less of a PC/Xbox exclusive than a Game Pass exclusive/available. I'd be willing to bet if Sony approached MS to bring Game Pass to PS, MS would be super willing to do it. Not that Sony would given their business model, but that's basically the point. It's not HW platform exclusivity, but store/subscription exclusivity.

Microsoft themselves said that they had no economic incentive to make Starfield exclusive prior to buying Bethesda then went and did it anyways. They have earned a huge amount of skepticism in any of these matters and are absolutely not trustworthy.

There's so much speculation about motives here. Neither you nor I have any idea what Microsoft's business strategy is. All I can judge them on is their actions. And their actions are buying up large publishers and making their most anticipated games exclusive to the Xbox. Sure Redfall was a somewhat minor release (and a mess), but what about Starfield? The game is hyped up to hell and now an Xbox exclusive as well.

Minecraft proves the parent's point. Following your logic, Microsoft should've made Minecraft an exclusive. They didn't. In fact they're expanding the footprint, rolling it out to Chromebooks last month.

Well, the FTC court docs show Phil Spencer wanted to (the spinoff Minecraft Dungeons), but couldn't due to the contract with Notch. He instructed his team to try and find a loophole, and described the contract as something he regrets. When asked about this on the stand, he said "We ended up releasing on PlayStation"

Oddly, I feel the writing is on the wall for this one. Minecraft would be a perfect game for the PSVR2, and yet?

People don't want to play Minecraft in VR. Witness Minecraft on Oculus.

It is on the PS VR1. And my family would love to play it on our system. Such that I can't believe it is "nobody."

Fair if you want to posit that VR is a niche market. But.... honestly, so is the entire Xbox market.

With the enormous size difference in Playstation to XBox markets, it is not a "piddly incremental" to also tap that market. Odds are stacked heavily against them making more by aiming for the subscription uptick they may see. That is, this is almost certainly a "grow the market" move. Hard to see it as anything else.

I totally agree. Xbox in the past 5-10 years really has been "Play our games where ever, just give us your money".

I just don't really get the argument of "We won't do this for 10 years". OK, what about after that?

I don't know. I doubt MS, Sony, or the FTC know either. They probably have an idea, but who's to say if it right or wrong? It's really hard to predict markets out that far.

Agreed. Selling exclusives would go against Nadella’s “Microsoft (makes money) everywhere” mantra

Case in point: Sony PlayStation is one of Azure’s largest customers

It’s strange for Nintendo not to see this

> Microsoft has committed in writing, in public, and in court to keep Call of Duty on PlayStation for 10 years on parity with Xbox.

Yeah, heard that one before.

> Oh but we promised Call of Duty and this is Duty Called, so we don't have to care about anything we have promised before.

I mean, this is Microsoft.

Why can't MS play along with the industry and support Vulkan on Xbox though? That would make them not look like the worst lock-in examples of the '90s.

Feels like these kind of issues are what anti-trust should have handled.

A large chunk of the entire purpose of Xbox is to cement DirectX as the default option to perpetuate that lock-in. It's even in the name: The Direct X-Box!

Yeah, clearly. But that's my point. Competition law should focus on preventing lock-in like this.

I don't think they really care what people think until it becomes a really major issue. MS has been through this these fazes so many times in the past and look at were they are. It doesn't seem to have slowed them down that much.

That lock in of the 90's never really stopped, they just figure out how to make it look better. The only times they gave up on the lock in was when it was starting to look really bad and even then they just pivot the messaging and then try to lock themselves in. Look at MS with "We love Linux", it didn't slow Windows down one bit.

Well, that's what you think competition law should have fixed. But yeah, it's pretty toothless in practice.

Playstation and Nintendo's support of Vulkan isn't exactly stellar. They support Vulkan the same way Unity/Unreal Engine support Linux.

Playstation - yeah (Sony doesn't care at all so far). Nintendo on the other hand is surprisingly positive about it:

https://www.khronos.org/blog/you-can-use-vulkan-without-pipe...

Which is refreshing.

It's a damn shame too, since they could really take advantage of things like dxvk (zlib licenced) to make porting existing games easier. Surprised no 'middleware' company has tried this either.

Intel is using dxvk.

Most games rely on engines that support Vulkan better now (like UE5), so there is not much of an interest I guess.

>What happens after 10 years?

Optimistically, Sony utilizes their Bungie aquisition and makes something worthy as a competitor. I imagine the 10 years is less a promise and more of a timer, and 10 years is enough for a AAA company to get at least a few attempts.

Pessimistically, MS drives Activision to the ground and COD isn't even a valuable IP anymore. Bigger icons have fallen from grace faster.

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