We’ve been talking about trademark and passing off as the “law of the marketplace.” Some IPs are so lucrative in the marketplace that they attract synergistic opportunities – one recent example of this is Microsoft’s acquisition of Activision Blizzard. This acquisition has garnered criticism among video game competitors like Sony as Activision Blizzard owns the IP rights to some of the biggest titles in the industry: Call of Duty, World of Warcraft, Overwatch, etc. The Gamer recently wrote on the topic and I’ve reproduced an interesting bit from the article below:
“Sony has consistently claimed that if Microsoft were able to gain control of the “irreplaceable” intellectual property owned by Activision Blizzard, the company would be able to increase the price of hardware, software, and subscription services including Game Pass. According to Sony, the “true strategy” being pursued by Microsoft is to make PlayStation “become like Nintendo” when it comes to big budget shooters.” (see: https://www.thegamer.com/microsoft-likely-offer-concessions-approval-eu-activision-blizzard-deal/).
(image sourced from: https://www.thegamer.com/microsoft-likely-offer-concessions-approval-eu-activision-blizzard-deal/)
Although the piece focuses mainly on antitrust in the EU context (i.e., Microsoft is having to make concessions to get regulatory approval in the EU – see https://www.thegamer.com/microsoft-likely-offer-concessions-approval-eu-activision-blizzard-deal/) it illustrates how the marketplace, or more precisely how competitors in the marketplace respond to the purchase and sale of IPs. Sony as a competitor to Microsoft is worried about how Microsoft will use Activision Blizzard IP to oust competition. This is significant because prior to this deal, Sony had a license in Call of Duty that granted exclusive perks to Playstation players. According to The Gamer, Sony contends that competing publishers like EA (developer Dice makes Battlefield) have unsuccessfully tried to dethrone Call of Duty, and that these “publishers do not have the resources or expertise to match [Call of Duty’s] success” (see: https://www.thegamer.com/microsoft-likely-offer-concessions-approval-eu-activision-blizzard-deal/).
I selected this piece to demonstrate a few points regarding IP in the context of business dealings. It’s interesting to see Sony making antitrust arguments, perhaps there is balance that needs to struck between promoting business ventures and protecting consumers who engage with the IP. Moreover, the article notes that Call of Duty is “the main point of friction preventing Microsoft from completing the acquisition of Activision Blizzard” (see: https://www.thegamer.com/microsoft-likely-offer-concessions-approval-eu-activision-blizzard-deal/). Again, quite interesting to see that IP is one of the main points of friction in closing this deal – it just goes to show how important certain IPs can be in both driving the deal, but also preventing it.
What do you think about Sony’s argument? Do you think it is valid?
Communications Law