Sony Claims Its AAA Exclusives Are Not Profitable
Reliance on third-party revenue is crucial for the company's innovative experiences.
Story Highlights
- Sony has claimed that their first-party exclusives are not profitable and that the sales revenue of third-party games is a key factor in their ability to invest in innovative hardware and games.
- Given the significance of third-party games, Sony’s decision to reject Microsoft’s 15-year Call of Duty deal seems to be a contradiction of their claims.
- According to Equity Report, China is likely to approve the Microsoft-Activision merger in the coming days. This will surely add a lot of momentum to the deal and bring the saga closer to its conclusion.
In the recent responses published by CMA, Sony has claimed that its first-party exclusives are not profitable. The Microsoft–Activision merger is an acquisition that can change the landscape of this industry. Sony has continued to stand in opposition citing the importance of market share and competition.
In CMA phase 1 responses, Sony makes an interesting claim that third-party franchises like Call of Duty inadvertently help fund first-party games development, implying that without hits like CoD, Sony may not be able to serve up high-profile 1P games. pic.twitter.com/Osy2wZSSc5
— Derek Strickland (@DeekeTweak) February 27, 2023
In light of this industry-changing deal, Sony has claimed that Call of Duty generates a significant amount of revenue. Moreover, it has stated that the loss of these users and the associated revenue streams will impact their ability to invest in innovative hardware and gaming technology.
The reliance on third-party sales revenue for their other projects comes as a bit of a surprise given how successful these exclusives are. It also raises the question regarding the worth of these exclusive first-party titles Sony has under their belt.
Considering the significance third-party games and Call of Duty hold for PlayStation, Sony’s recent decision appears to be a contradiction. Microsoft offered a 15-year Call of Duty deal to its competitor which was promptly declined.
On the other hand, it seems that the deal is garnering support from various countries. Earlier this month, Equity Report stated that China was likely to approve the deal in the coming days. As of now, the merger has not arrived at anything concrete but it’s definitely on the fast track to its conclusion.
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