The Microsoft FTC trial is a wrap, and while we don't have a ruling yet, we learned a lot of inside industry information that's not usually available to the public.
From drama surrounding the exclusivity of Starfield and other Bethesda titles to the cost of producing huge AAA games like The Last of Us Part II, there were plenty of bombshell reveals from this week's court battle. Here are 12 big things we learned from the Xbox FTC hearing.
Xbox Admits It Lost the Console Wars
The entire Xbox/Activision Blizzard saga has been filled with both Microsoft and Sony downplaying their respective achievements to appear as meek as possible to regulators. The FTC hearing was no exception, as the week kicked off with news of Microsoft claiming Xbox has officially "lost the console wars".
Microsoft claimed its original Xbox was crushed by Sony and Nintendo when it entered the market in 2001, and the company said it's been "losing" the "console wars" ever since. Citing numbers from 2021, Microsoft said Xbox held a 16% share of the console video game market. Xbox's Phil Spencer also said a piece on the console wars, calling it a “social construct within the community” during his testimony.
Microsoft Says Next Gen Could Start in 2028
Years of hardware shortages and a slew of cross-generation game releases can make it feel like this console generation just started. But the reality is that we're creeping up on the PlayStation 5 and Xbox Series X|S' third birthday parties. In court documents reviewed by IGN, Microsoft is expecting the next generation — meaning the PlayStation 6 and Xbox Series X|S successor — to begin in 2028.
If Microsoft's projection remains accurate, that means we're just a year-and-a-half away from the halfway point of this current generation. 2028 places the PS5 and Xbox Series on an eight-year cycle, which is one year longer than the PS4 and Xbox One, and roughly the same length as the Xbox 360/PS3 generation.
Microsoft Wanted to Scoop Up Bungie, Sega, Square Enix, Zynga, and More
The last few years have seen the gaming industry's biggest players go on an acquisition spree. We've seen Sony acquire Bungie, Microsoft acquire Bethesda, and a lot more. But in court documents, we've learned that Microsoft had plans for some big-name transactions that didn't end up happening.
Namely, Microsoft had conversations about acquiring Sega, Square Enix, Zynga, and even Bungie before Sony bought them. But Microsoft's ambitions went well beyond these big players. Internal documents reveal a list of 100 developers Microsoft considered at one point, before narrowing it down to eight final candidates. This list included Hades developer Supergiant Games, Pokemon GO's Niantic, IO Interactive, and more.
AAA Sony Games Cost $200 Million-Plus to Produce
We've always known modern AAA video games cost a ton of money to make. But now we have a good idea of just how expensive some of these games are. In a poorly-redacted document submitted by Sony Interactive Entertainment, we learned The Last of Us Part II cost $220 million to develop, while Horizon Forbidden West cost $212 million. In the document, PlayStation said the costs are justified because AAA games "create deep and ongoing engagements with players."
These costs give more context to recent comments from Xbox Game Studios' Matt Booty, who said big-budget AAA games cost a half-decade or more to make, and failure can potentially ruin a studio.
Call of Duty Is, in Fact, Worth a Lot of Money
Unsurprisingly, Call of Duty was at the center of almost the entire courtroom battle over the last week. Activision's biggest asset came up repeatedly, with the FTC raising concerns about exclusivity, or the potential of Activision releasing a worse version of Call of Duty on PlayStation.
Call of Duty's impact makes sense, given that the same poorly-redacted document from Sony revealed that Call of Duty generated over $800 million for PlayStation in the United States alone in 2021. From Phil Spencer testifying under oath that Xbox will keep Call of Duty on PlayStation, to claims that Activision CEO Bobby Kotick threatened to pull Call of Duty from Xbox unless Microsoft granted Activision a higher revenue share, we learned a lot about the value of the franchise to both Sony and Microsoft.
Jim Ryan Doesn't Think Starfield's Exclusivity Is Anti-Competitive and Says PlayStation Will Be Fine
PlayStation boss Jim Ryan made it very clear that he's not a fan of Starfield's Xbox exclusivity. That being said, he admitted he doesn't think it's anti-competitive. Publicly, PlayStation has been the biggest opponent of the Microsoft Activision merger. But privately, it's a bit of a different story.
In an email sent after Microsoft announced its intent to acquire Activision Blizzard, Ryan wrote, “I’m pretty sure we will continue to see Call of Duty on PlayStation for many years to come,” expressing that PlayStation would be more than okay if the transaction was approved.
Starfield Almost Skipped Xbox Entirely
Starfield is coming out this September as an Xbox exclusive, but that wasn't always going to be the case. Xbox boss Phil Spencer confirmed that Starfield was potentially going to skip Xbox entirely prior to Microsoft's acquisition of ZeniMax.
Xbox was worried about losing out on Starfield following PlayStation's exclusivity deals for Bethesda games like Ghostwire: Tokyo and Deathloop. Spencer said Microsoft had to secure content for Xbox to "remain viable in the business." Xbox did so by acquiring ZeniMax altogether, locking down Starfield as an Xbox exclusive.
Drama Surrounding Bethesda Exclusivity: Indiana Jones, Elder Scrolls, and More
The FTC tried to prove that Xbox's treatment of ZeniMax games could demonstrate how the company will handle exclusivity when it comes to Activision Blizzard games. One piece of evidence used was a chat exchange between Xbox's Tim Stuart and Matt Booty. The chat log focused on a November 2021 meeting, where Phil Spencer apparently decided to make all future Bethesda games Xbox exclusives, not just new IP.