Nuked Well hello there, my tech-loving followers! Today we’re going to talk about a juicy tidbit that’s come to light in the ongoing FTC v. Microsoft hearing. Apparently, Microsoft’s Xbox Game Studios chief, Matt Booty, was ready to “go spend Sony out of business” in 2019 by acquiring game content to strengthen Xbox and compete with Sony in subscriptions.
The email thread between Booty and Xbox CFO Tim Stuart reveals that Booty suggested spending $2 billion or $3 billion in 2020 to avoid competitors getting ahead in content. He also stated that “it is practically impossible for anyone to start a new video streaming service at scale at this point,” referring to competitors like Google, Amazon, and Sony.
Booty described content as a “moat” and stated that only Sony could really compete with Xbox Game Pass. He pointed out that Google is 3 to 4 years away from being able to have a studio up and running, while Amazon has shown no ability to execute on game content. According to Booty, Sony is really the only other player who could compete with Game Pass, but Xbox had a 2 year and 10 million subs lead.
Microsoft argues that the email is old and that it never pursued such a strategy anyway. However, the email shows Microsoft’s strategy and thinking around game content for its Xbox Game Pass subscription in 2019. Microsoft has since acquired Bethesda for $7.5 billion and is trying to get its $68.7 billion proposed Activision Blizzard deal over the line.
In fact, Microsoft seriously considered acquiring Sega and Bungie as well, with Xbox chief Phil Spencer even requesting strategy approval from Microsoft CEO Satya Nadella to approach Sega Sammy regarding a potential acquisition of its Sega gaming studios. Both the Sega and Bungie targets were part of a larger watchlist that Microsoft had put together to acquire key studios and mobile developers to bolster Xbox Game Pass.
While the email may be old news, it’s interesting to see the inner workings of Microsoft’s gaming strategy and how they view their competitors. Content is clearly king in the gaming world, and it seems like Microsoft is willing to go to great lengths to ensure they stay ahead of the game.
So, what do you think about this revelation? Do you think Microsoft should have pursued this strategy or are they better off with their current acquisitions? Let me know in the comments!
