Ever since it first expressed interest in buying Activision earlier this year, Microsoft has had to fend off (justifiable) concerns regarding any forthcoming ability to stamp out competition. The US Federal Trade Commission (FTC), UK Competition and Markets Authority, and other government watchdogs have all launched investigations into the bid out of concern that Microsoft—which would become the world’s third-largest gaming company—could present a monopolization risk. This problem escalated last week with the FTC’s announcement that it would be suing to block Microsoft’s purchase.
Now Smith is running damage control, insisting to regulators that the acquisition won’t result in Microsoft hoarding major franchises. In the company’s most recent shareholder meeting, Smith is said to have argued that Sony has more of a stronghold on popular franchises than Microsoft does. According to Bloomberg, Smith said Sony’s PlayStation has 286 exclusive games while Microsoft’s Xbox has just 59, and that a judge will “have to decide whether going from 59 to 60 is such a danger to competition that he should stop this [acquisition] from moving forward.”
It’s a mystery how exactly Smith came up with those numbers, but he got his point across nonetheless. Reminiscent of Microsoft’s statement this summer about Activision having no “must have” titles, Smith is making the argument that Sony shouldn’t sweat over the acquisition—because Activision hasn’t made anything worth sweating over in the first place.
To sweeten the deal, Smith reportedly offered up a legally-binding consent decree that would keep Call of Duty—Activision’s biggest franchise—on PlayStation for a decade following the acquisition. The decree had been in the making since November and tracks with Microsoft’s other ten-year offers, like the one it made to Nintendo just last week.
Despite its vote to sue, the FTC has maintained somewhat of an air of mystery surrounding the acquisition: In response to Microsoft’s PlayStation consent decree, the FTC only said that it’s “always willing to consider remedy proposals.” But if the FTC still isn’t pleased, It’s hard to imagine what else Microsoft could do to appeal to Sony and antitrust watchdogs—other than dropping the deal altogether, that is.