Microsoft has started arguing in favour of its acquisition of Activision Blizzard before the Federal Trade Commission. According to the company’s strategy, it has fallen short in the “console war” with Sony and Nintendo. Although the big three control the market, Microsoft asserts that it comes in a very distant third place when compared to its competitors. The “console war” basically refers to the perpetual fight that is going on between Microsoft, Nintendo, and Sony.
Also Read: Microsoft welcomes Orca, a new AI model integrated with GPT-4
In a document submitted by Microsoft in a court hearing, the company has put forth its argument about how it has been losing this console war to its rivals since 2001. In its argument, it claimed that the PlayStation 2 and GameCube outsold the first Xbox by a substantial margin in terms of sales. Further, the company has claimed in its document that the scenario has continued to remain the same.
Microsoft wrote, “Xbox has lost the console wars, and its rivals are positioned to continue to dominate, including by leveraging exclusive content.” The Xbox creator further added, “Xbox’s console has consistently ranked third (of three) behind PlayStation and Nintendo in sales. In 2021, Xbox had a share of 16 percent, while Nintendo and PlayStation had shares of [redacted] and [redacted], respectively. Likewise, for console revenues and share of consoles currently in use by gamers (‘installed base’), Xbox trails with 21 percent, while PlayStation and Nintendo have shares of [redacted] and [redacted], respectively.”
Reports and the hardware and software sales tracker, VGChartz suggest that the company’s most recent consoles, which include the Xbox Series X and Xbox Series S, were only able to sell 21 million units as of April 2023. In contrast, the PlayStation 5 and Nintendo Switch were each able to sell around 36 million units. It is also noted that the handheld console has a slight edge in sales.
Microsoft declared that it has largely stopped trying to compete in the current console war and is instead concentrating on providing its player base with software that either hasn’t been released or has failed. The majority of what Xbox has been doing recently, such as its intense focus on developing its Game Pass subscription programme, has displayed this focus. Microsoft appears to be less focused on dominating the market and more committed to being the first Netflix in its sector.
Microsoft further wrote in the document, “Having lost the console wars, Xbox is betting on a different strategy than Sony [and Nintendo].” It further added, “Xbox generates profits through game sales, not console sales. That is because Xbox sells its consoles at a loss, effectively subsidising gamers’ purchases of the hardware in hopes of making up the [lost] revenue through sales of games and accessories.”
Also Read: Microsoft executive calls for faster AI regulation: Report
These revelations coincide with Microsoft’s announcement that it anticipates the launch of the next console generation in 2028. If and when the business acquires Activision Blizzard, this would suggest that Call of Duty would still be available on competing platforms. However, Sony isn’t too excited about the deal. Sony PlayStation boss Jim Ryan said in the same hearing that if the acquisition were to go through, the company wouldn’t discuss information regarding a potential PlayStation 6 with the Call of Duty developers. It goes without saying that this may have a variety of effects on PlayStation Call of Duty players.
