Players who have been following the industry know that at the beginning of 2022, Microsoft announced the acquisition of Activision-Blizzard, one of the biggest companies in the gaming world. Then, more than a year of lawsuits led to a chain of revelations. So, why is the Call of Duty so important?
Microsoft’s acquisition of Activision Blizzard, the owner of Call of Duty IP, opened Pandora’s box and led to the biggest war between Sony and Microsoft. This announcement by the company that previously bought Bethesda dropped like a bomb on the gaming world. It brought the questions “What’s next?” to mind.
Why is the Call of Duty so important for Microsoft and Sony?
To answer these question, we need to take a look at the Call of Duty brand and its history. It was first released on October 29, 2003 for PC, Mac and n-Gage. The World War II game, which dethroned Medal of Honor, has been on our gaming devices with 21 games to date and has sold more than 400 million units in total, generating a turnover of 30 billion dollars. In addition, the Call of Duty Mobile game has been downloaded more than 100 million times on these platforms and is estimated to have a turnover of more than 1 billion dollars.
Activision-Blizzard, which also owns Call of Duty, is Microsoft’s biggest acquisition to date and is at the center of this battle. Does just one game cause such an uproar that will have such a profound impact on the industry?
Many surveys have been conducted to clarify the issue, but two stand out. The first one is a survey conducted by the CMA. When gamers were asked about CoD’s influence on their PlayStation purchases, 73% of respondents said they bought the PS5 to play CoD. While this may be an exaggerated figure (and the CMA has admitted that it is an exaggeration), even if it’s equivalent to 25%, it’s still a huge percentage.
The other survey was conducted by Microsoft on YouGov last January. It found that only 3% of gamers buy a console to play CoD. Personally, I think this survey would be more accurate, but I’m still not sure about Microsoft’s sincerity when it comes to Microsoft changing its initial aggressive strategy and opting for a more gamer-friendly approach.
The acquisition will cause a huge loss of revenue for Sony in the long run. Sony made 1.37 billion dollars in 2020 just from Call of Duty games. This is equivalent to 17% of Activision’s revenue of the same year. Even though this rate dropped to 15% the following year, it was still a very large turnover.
Fun Fact:
Sony was Activision Blizzard's largest customer in 2020 accounting for 17% of it sales or ~$1.37 billion.
Microsoft was Activision Blizzard's 4th largest customer in 2020, behind Apple and Google, accounting for 11% of its sales or ~$890m pic.twitter.com/9dlm6vhDhA
— Daniel Ahmad (@ZhugeEX) September 7, 2022
PlayStation is not only concerned about the loss of game sales. It also has to think about the device customers it will lose. Considering the processes ahead, it will also put its dominance in the console market in difficulty.
The passage of players who will follow the game and switch to the rival platform may cause move the mountains.
In the long run, the damage to the competition means a negative impact on spending for gamers. The fact that Microsoft has a weak competitor in front of it means that it can intervene in game prices as it wishes. Of course, it is not known whether the company will take such a step, but it is among the most suspicious that Sony and competition institutions have ever carried.
Not only in terms of game prices. The fact that the company has the trump cards such as quality, innovation and blocking of games to publish specific paltforms means that it can also intervene in technology such as cloud gaming in the future.
Microsoft’s statement “Not publishing the game on other platforms would cause a significant loss of revenue for Microsoft” in order to reassure the companies on this issue does not seem sincere to these institutions. Because when we look at the big picture, it is seen that the revenue generated by Sony’s console-exclusive Spider-Man or other games is not that big.
The size of the revenue loss that Microsoft’s withdrawal of Call of Duty games from the PlayStation platform will cause for Sony is enormous. Not only from game sales, but also from the loss of value of the company’s shares. When the acquisition was first announced, Sony’s shares fell by 13%. If the sale goes through, it is a harbinger that this loss will be even bigger. Not only the gaming side of Sony, but also the company as a whole will be affected.
Considering all this, if Microsoft’s acquisition of Activision-Blizzard is approved, Sony may not be able to recover from the loss or it may take many years.
This content is a compilation of current information, research and company claims. It is intended to help you interpret the answers to the questions “Why is Call of Duty so important?”, “What will players and companies face if this acquisition goes through?”.
