Microsoft claimed on Tuesday night, in one last attempt to reassure antitrust investigators, that it would bring the blockbuster video game franchise Call of Duty on Nintendo devices only if the $68.7 billion acquisition of the game’s maker, Activision Blizzard, was completed.
Microsoft’s acquisition of Activision, the largest consumer technology transaction since AOL’s acquisition of Time Warner two decades ago, is being reviewed by antitrust authorities around the world.
Many in the video gaming industry expect that the Federal Trade Commission will address the transaction during a closed-door session on Thursday. The commission may vote on whether to pursue a lawsuit to stop the purchase.
Authorities are especially concerned about consumer harm if Microsoft, maker of the Xbox console, blocked Activision’s games from competitors or unfairly leveraged Activision’s popular titles as more video games were streamed online.
The 10-year agreement to bring future Call of Duty releases to Nintendo’s Switch video game systems, one of Microsoft’s competitors, is part of Microsoft’s efforts to show that it will not prohibit the popular game from devices created by other companies.
Microsoft also stated that it would continue to work with Valve, the creator of the Steam distribution network, which is popular among gamers who prefer to play on personal computers rather than game consoles, to release Call of Duty. The most recent Call of Duty game is already available on Steam.
“There’s been some question about whether what we’re saying is actually how we’re acting, and I think having two major industry partners kind of show that our intent is real and that we can reach agreements is an important thing in this time,” Phil Spencer, the chief executive of Microsoft’s gaming business, said in an interview.
Call of Duty is also a key video game for Sony‘s PlayStation console, and Microsoft has vowed to keep that connection going for at least another ten years if the Activision transaction is completed. Sony did not respond to Microsoft’s offer after it was made. Sony has protested Microsoft’s acquisition of Activision, claiming that it will decrease gaming options.
“We’re happy that Microsoft wants to continue using Steam to reach customers with Call of Duty when their Activision acquisition closes,” Gabe Newell, the president of Valve, said in a statement. “Microsoft has been on Steam for a long time and we take it as a signal that they are happy with gamers’ reception to that and the work we are doing.”
Call of Duty is a long-running franchise in which people play on historical, modern, and future battlefields. It is the crown jewel in Activision’s portfolio. It has a revenue of more than $30 billion. Modern Warfare II, the most recent iteration, grossed more than $1 billion in just 10 days.
Adding a violent first-person shooter game like Call of Duty to the Switch’s library of games would be a surprise departure for Nintendo. Though it does offer some more mature games, the business has long been cautious of the lighthearted, family-friendly identity it has created over decades through iconic brands like Mario, Pokemon, and The Legend of Zelda.
Sony and Microsoft have often argued over a comparable group of so-called hard-core gamers, who may choose dark, story-driven games or tough and violent action games.
However, Nintendo has made a fortune by promoting lovable, candy-colored characters such as the squishy pink Kirby and the smiling dinosaur Yoshi. Animal Crossing: New Horizons, a peaceful game in which players develop virtual islands, became a major hit during the start of the pandemic.
The Switch, Nintendo’s newest platform, is substantially less expensive than Sony’s PlayStation 5 or Microsoft’s Xbox Series X, and it varies from the more expensive, boxier consoles in that it is compact and portable, allowing users to game on the go.
The Switch has been a phenomenal success, with 114 million copies sold as of September 30th. However, it has less processing power than the most recent Microsoft and Sony consoles, prompting concerns about how well Call of Duty will play on a Nintendo system.
“Nintendo has done a great job of creating a family-friendly platform that can be successful for all kinds of creators,” Mr. Spencer said, adding that there was “definitely work” to be done to make Call of Duty run well on the Switch. Still, Nintendo does already offer some shooter games on the Switch, like Fortnite, and Call of Duty could appeal to Nintendo users who want a “flexible style of gameplay,” said David Gibson, a senior analyst for the Australia-based financial services company MST Financial. The move, he said, would be “good for Nintendo’s platform for sure.”
Microsoft’s most important consumer business has become gaming, and when it announced the Activision acquisition in January, it hinted that winning antitrust approval could be difficult. Microsoft claimed the transaction might take a year and a half to complete, and it has promised to pay Activision up to $3 billion if the merger fails.
Microsoft’s president, Brad Smith, wrote about the 10-year offer to Sony in an opinion piece published in The Wall Street Journal on Monday, saying the company was “open to providing the same commitment to other platforms and making it legally enforceable by regulators in the U.S., U.K. and European Union.”
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