The drama from the Xbox/Activision case continues to grow as the FTC court case continues and in a recent development, an email has surfaced that is being used as evidence that Microsoft’s goal with the acquisition of Activision-Blizzard is to push Sony out of the industry entirely. However, the evidence being used for this claim is an old email from 2019, sent nearly three years before the deal between the two companies was ever even announced.
The quote garnering particular scrutiny at the moment comes from the start of the email, sent on December 17, 2019, by Xbox’s Matt Booty. The quote states that “… we (Microsoft) are in a very unique position to be able to go spend Sony out of business.” It goes on to draw comparisons to other upcoming potential gaming competitors in Google, Amazon, and Sony and suggests that a potential loss of revenue in 2020 would wind up being worth it years down the line to prevent these competitors from becoming “…the Disney of games and [owning] most of the valuable content.”
Related: The Microsoft/Activision Deal May Be Blocked In Yet Another Country!
What Does Xbox’s Email Tell Us?
While the email does not directly relate to the buyout of Activision by Xbox, it could give us a bit of insight into Microsoft’s motivations. The email goes on to talk about how Xbox has a strong library of existing content and how its premier subscription service, GamePass, had no real competitors at the time. It mentions directly that “Sony is really the only other player who could compete with Game Pass, and we have a 2 year and 10M subs lead.”
It seems to suggest that Xbox’s intentions with studio buyouts, such as the Bethesda one which took place several months after this email was sent, was to build up its content library, specifically to increase the value of GamePass as a service. This tracks with much of what Microsoft has claimed and done since the acquisition of Activision began, as well as the fact that it releases every first-party title onto the service. It seems the primary point of the email was not just to suggest pushing Sony out of the industry, but to recommend preventing it from having a chokehold on all of the most prolific gaming franchises.
It seems a lot of the email is focused on recommending that Xbox continue to spend resources on bolstering its available content library, likely preparing for an expected competitive battle between GamePass and potential competing games subscription services. Matt Booty notes in the email that “Google is 3 to 4 years away from being able to have a studio up and running” and that they believe Amazon is incapable of “[executing] on the game content,” thus leaving Sony as their only serious worry in this landscape.
The suggestion that they could push Sony out of business, however, raises eyebrows over whether they want to bolster their portfolio to compete or to take over the industry entirely. In a statement made to IGN, a Microsoft spokesperson said “This email is three and a half years old and predates the announcement of our acquisition by 25 months. It refers to industry trends we never pursued and is unrelated to the acquisition.”
A key point mentioned at the bottom of the email notes that reversing course on Xbox’s focus on GamePass would make it hard to convince consumers that the at-the-time in-development xCloud game streaming tech and Microsoft’s former content streaming service Mixer, meant to compete with Twitch, would be worth their time either. Mixer would go on to be shut down roughly seven months after this email was sent, but users would later see xCloud renamed to simply GamePass Streaming and added as another feature to GamePass Ultimate. Gamers can now stream many GamePass games directly to their phone, computer, or Xbox when using this feature, allowing users to try out games before they even install them on their console.
Currently, Xbox is fighting the FTC in a court case where the regulation agency seeks to block the deal from being completed until a hearing in August. If successful, it could result in the deal falling apart entirely, for if the deal is not completed by a set date in July, the companies will be forced to enter renegotiations, and how those would pan out is anybody’s guess.
How do you feel about this email? Do you think Xbox is trying to take over the industry, or do you agree with the reasoning presented in it? Let us know on our social media feeds and in the comments!
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