Sony and Microsoft have come to an agreement, committing to a ten-year deal for Call of Duty

Sony and Microsoft have come to an agreement, committing to a ten-year deal for Call of Duty

Sony and Microsoft have reached a 10-year agreement for Call of Duty to remain on PlayStation following the proposed acquisition of Activision Blizzard by Microsoft. The deal marks the end of a contentious dispute between the two companies, which has been ongoing since Microsoft announced its acquisition plans in January 2022.

Initially, Microsoft’s offer to Sony included keeping all existing Activision console titles on PlayStation until December 31st, 2027, including future versions of Call of Duty and other Activision franchises. However, the terms have since been revised, limiting the agreement to a 10-year extension solely for Call of Duty.

Sony had been hesitant to sign the deal, fearing that Microsoft might make Call of Duty exclusive to Xbox or undermine the PlayStation versions of the game. However, during a court hearing involving the FTC and Microsoft, an email from PlayStation chief Ryan suggested that he was confident about Call of Duty remaining on PlayStation for many years to come.

The agreement comes after numerous discussions and counteroffers over the past 18 months between Microsoft and Sony regarding the future of Activision content on PlayStation. During these discussions, an email from Xbox chief Spencer to PlayStation chief Ryan outlined a list of Activision games that would continue to be available on PlayStation, which did not receive a positive response from Ryan.

It was not a meaningful list. This list represented a particular selection of older titles that would remain on PlayStation, for example Overwatch is on there but Overwatch 2 is not on there, the current version of the game.

The email exchange caused a significant breakdown in communication between Spencer and Ryan. Shortly after the email was sent, Spencer publicly stated that Call of Duty would continue to be available on PlayStation for several more years beyond the current contract with Sony. Ryan expressed dissatisfaction with Spencer’s decision to disclose contract negotiations to the public, considering it inadequate and not taking into account the impact on gamers.

Tensions surrounding Microsoft’s proposed acquisition of Activision Blizzard escalated when Jim Ryan had a conversation with Activision CEO Bobby Kotick on February 21st, 2023. During that conversation, Ryan made it clear that he was not interested in a new Call of Duty deal and instead wanted to block the merger entirely. Ryan confirmed this meeting during testimony in the FTC v. Microsoft hearing, where he stated that he believed the transaction was anti-competitive and hoped that regulators would prevent it from proceeding. Meanwhile, Kotick sought to secure an extended Call of Duty deal with Sony as a safeguard in case the Microsoft deal fell through, while Microsoft actively attempted to entice Sony into signing a deal.

Microsoft consistently maintained its stance that it would keep Call of Duty available on PlayStation, arguing that removing the game from Sony’s consoles wouldn’t make financial sense. In November, Xbox chief Spencer attempted to settle the argument, and during court proceedings, he reiterated under oath that Call of Duty would remain on PlayStation 5.

The focus now shifts to the regulatory situation in the UK, where Microsoft’s proposed deal was blocked earlier in the year. The Competition Appeal Tribunal (CAT) will hold a case management conference tomorrow, where Microsoft and the Competition and Markets Authority (CMA) will discuss the possibility of adjourning the proceedings to facilitate further negotiations. Both parties have paused their legal battles to address the CMA’s concerns about cloud gaming. However, the CMA warned that the proposed modifications might trigger a new merger investigation, and discussions with Microsoft are still at an early stage.

Despite this, the CMA extended the investigation into the deal, pushing the final order date from July 18th to August 29th. Microsoft aims to close its acquisition of Activision by the initial deadline, but there might be a slight delay to allow resolution of the UK regulatory situation.