Has Xbox really lost the console wars?
The second day of the FTC v. Microsoft hearing was really all about one man: Phil Spencer. The Xbox chief took the stand to discuss Microsoft losing the console wars, Sony’s aggressive and hostile competition, and to paint Xbox in a distant third place where it’s struggling to compete.
Spencer also revealed Microsoft looked at buying Zynga to improve its mobile gaming prospects and acquired Bethesda after learning that Starfield might become a PlayStation exclusive. He also, importantly, swore under oath that Microsoft won’t pull Call of Duty from PlayStation. That promise turned into some frustrations with the FTC’s line of questioning from Judge Jacqueline Scott Corley and some testy exchanges between the FTC’s lawyer, James Weingarten, and Spencer.
Oh, and Google turned up at the end to talk about Stadia in a rushed last-minute testimony.
Yeah, it was a lot. Let’s dig in to day two.
We kicked off the day with a sealed courtroom so that Jamie Lawver, senior finance director at Xbox, could deliver witness testimony about highly confidential Xbox financials. We don’t know what Lawver revealed to Judge Corley, but it set the stage for Spencer to appear and talk about the Xbox platform and the Nintendo Switch.
The FTC and Microsoft have been arguing about whether the Switch should be included in its definition of the console market for two days now and in multiple filings with the court. Microsoft wants the Switch included because then Xbox is in third place. The FTC argues that inside Microsoft it’s always competing and comparing Xbox to PlayStation, not Switch. It provided market analysis and metrics that Microsoft uses internally to back up its “high performance” console market of just the PS5 and Xbox Series S / X
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