Congress Calls for Investigation into Sony's Alleged Monopoly & Anti-Competitive Conduct in Japan's Gaming Market

Sony faces allegations of anti-competitive conduct within the Japanese gaming market as Congress calls for an investigation into the company's monopoly. At a recent Senate Finance Committee hearing, Senator Maria Cantwell revealed that Sony holds a 98% share in the high-end gaming market in Japan. She condemned the Japanese government's lack of action despite the company's apparent engagement in exclusionary practices through exclusive deals and payments to game publishers.

Senator Cantwell urged US Trade Representative Katherine Tai to address the matter and foster fair competition, while two separate letters from Democrats and Republicans requested a thorough probe of Sony's tactics. Both Tai and Commerce Secretary Gina Raimondo received the letters, which pointed to the potential infringement of Japanese antitrust laws by Sony, specifically citing deals designed to prevent Japanese games from reaching Microsoft's Xbox platform.

Accusations against Sony's non-prosecution policy highlight barriers to US exports, impacting Microsoft and numerous US-based game developers and publishers. Hindered earnings within the Japanese market present a significant challenge for these companies, emphasizing the need for investigation and regulatory intervention.

While Sony grapples with these monopoly allegations, Microsoft itself faces intense scrutiny in relation to its $69 billion acquisition bid for Activision Blizzard. However, the UKs Competition and Markets Authority (CMA) announced provisional findings which suggested that the merger would not substantially reduce competition in the UK's console gaming services. Concerns initially raised by the CMA were addressed following a comprehensive review of substantial new evidence in Microsoft's favor.

Martin Coleman, the chair of the independent panel of experts responsible for the CMA's investigation, stated that the cost of withholding Call of Duty from PlayStation would far exceed any potential gains. Consequently, Microsoft's takeover of Activision Blizzard is not expected to result in a significant reduction in competition for console gaming services in the UK.

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