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Sony takes 30% of our gaming revenue and uses it to hurt us

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News continues to trickle in about the Federal Trade Commission's (FTC) lawsuit against Microsoft over its proposed $1.5 billion acquisition of publisher Activision Blizzard.

The court witnessed the presence of the CEO of Microsoft Satya Nadella With the head of the company's games sector Phil Spencer personally to court, along with several other executives, along with the head of PlayStation Jim Ryan and CEO of Activision Bobby Kotick.

The session began yesterday, June 22, and will last for five days, during which it will determine the fate of its acquisition of one of the largest game publishers, through which the Federal Trade Commission (FTC) wants to issue an injunction to prevent Microsoft from completing the deal before a separate legal challenge is scheduled to be filed. It will be released on August 2.

The first session saw a lot of direct Q&A, including statements from the Xbox president Phil Spencer andWhen asked by the FTC attorney about the nature of the competition with Sony, he explicitly responded that he sees Sony as a fierce competitor, and continued:

“Sony is a market leader with great capabilities and a strong competitor.”

“Every time we release a game on PlayStation… Sony takes 30% of the revenue we generate on their platform and then uses that money among other revenue they need to try to reduce the Xbox’s survival in the market.”

We try to compete, but as I said, in the last 20 years we have not been able to do that effectively.”

Through these statements, Spencer believes that Sony uses its market position to limit Microsoft's role in the video game market and uses the money it earns from the launch revenue of Microsoft-owned games released on PlayStation, such as Minecraft and others, to do so.

Phil Spencer has confirmed that Xbox has lost the console wars, emphasizing that they have been in third place behind Sony and Nintendo in the console gaming market for over twenty years.

The stakes are high for Microsoft, which now has until July 18th to attempt to close the proposed acquisition; otherwise, they would have to pay Activision Blizzard a $1.4 billion separation fee or renegotiate new terms. The FTC isn't the only regulator trying to prevent this deal from happening, either. The UK Competition and Markets Authority (CMA) decided to block the deal in April, and the company is currently working to appeal that decision.