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The FTC will investigate Sony’s Bungie acquisition

The Federal Trade Commission (FTC) has launched an investigation into Sony’s $3.6 billion acquisition of Bungie. Sony announced its plans to purchase the studio behind Destiny on January 31, not even two weeks after Microsoft announced its plans to buy Activision Blizzard for a monstrous $70 billion, which the federal agency is also reviewing.

According to a report from The Information, sources familiar with the situation said that the FTC’s latest probe demonstrates its aggressive approach to consolidations within the technology sector, especially those taking place on the gaming side. The credit for this penchant for scrutinizing gaming industry acquisitions goes to Lina Khan, whom President Joe Biden appointed FTC Chair last year.

The FTC’s main concern about Sony’s acquisition of Bungie is about whether or not it will make its games exclusive to the PlayStation platform, especially on the new PS Plus subscription service, once the deal closes. It looks to explore whether or not such exclusivity would impede competition with rival companies, such as Microsoft and Nintendo. Jim Ryan, President and CEO of Sony Interactive Entertainment, made it clear in a blog post published the same day the company announced the merger that Bungie will retain its status as an independent and multiplatform game studio and publisher even after the deal closes. Bungie even hinted that the reason for the merger is to expand its entertainment prospects outside of games.

The federal investigation may not block the deal entirely, but it could potentially delay its closing by six months or more, possibly pushing the closing date to 2023. Sony expects to close the deal with Bungie by the end of the year.

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Cristina Alexander
Cristina Alexander has been writing since 2014, from opining about pop culture on her personal blog in college to reporting…
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PlatinumGames President Atsushi Inaba turned heads in a recent interview when he indicated that the beloved Japanese developer would move away from the kind of single-player games it is known for. While PlatinumGames made a name for itself with linear, single-player action titles like Bayonetta and Nier: Automata, Inaba believes the company should make more titles that players can enjoy for long periods of time.
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It pays to win
The answer is more straightforward than one might think. In reality, it comes down to what makes money. Yes, single-player games can still be successful and perform well for companies, but data from analysts highlights how much the DLC, microtransactions, and subscription elements of live service games make. Mat Piscatella, NPD Group executive director and video game industry adviser, explained this on Twitter, noting that 60% of non-mobile game content spending comes from DLC, microtransactions, and subscriptions.
https://twitter.com/MatPiscatella/status/1490711392449486851
It's not surprising that PlatinumGames executives see that the studio is leaving money on the table by not developing games that engage players like that. Bayonetta 3 could sell millions of copies when it launches later this year, but live service games could sell the same amount and then continue to make money years after launch.
Multiple analysts have recognized this trend too. Niko Partners senior analyst Daniel Ahmad tweeted a chart revealing that Sony made more from add-ons, microtransaction, and DLC content than digital and physical game sales combined. 
https://twitter.com/ZhugeEX/status/1490714400000512005
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Quality over quantity 
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Meanwhile, live service will be just one part of Sony's first-party game strategy in the future. While the Bungie acquisition may allow the company to make more live service games, plenty of single-player PS5 exclusives like Horizon Forbidden West, God of War: Ragnarok, and Marvel's Spider-Man 2 are still on the way. Sony also intentionally acquired Bungie because of its live service experience with games like Destiny 2, so it wants to approach that kind of game correctly. 
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