Is it necessary for Sony to provide a reaction to Microsoft's acquisition of Activision Blizzard?

Is Sony required to react to Microsoft's substantial $69 billion acquisition of Activision Blizzard? This is the pressing question in the video game industry, as the company behind Xbox makes a significant investment in its efforts to catch up in the gaming market.

In the current month, Microsoft has finally completed its long-standing pursuit of acquiring Activision Blizzard, the developer behind popular titles like Call of Duty, World of Warcraft, and Candy Crush. Microsoft is now focused on integrating the Activision Blizzard business into its operations.

While Xbox executives have assured that Activision Blizzard games won't be available on Game Pass until the following year, Microsoft's position in the ongoing console competition, which it has acknowledged losing, appears to be on the rise.

Sony, enjoying the success of the PlayStation 5 and its first-party games achieving record-breaking sales, may not have the financial resources to match Microsoft's extravagant mergers and acquisitions spending. Nevertheless, in recent years, Sony has made strategic acquisitions, such as the $3.6 billion purchase of Destiny creator Bungie and the acquisition of Spider-Man 2 developer Insomniac for $229 million, which now appears to be a bargain.

The question now arises: Does Sony need to respond to Microsoft's acquisition of Activision Blizzard with further acquisitions of its own? This was a question posed to Eric Lempel, the head of Sony Interactive Entertainment's business, by CNBC. Lempel emphasized that PlayStation is actively seeking partnerships but may not necessarily be inclined to buy other companies outright.

Lempel stated, "We have a number of ways of looking at this," and he emphasized their focus on creating exceptional content. He further explained, "We've done more M&A [mergers and acquisitions] in the past decade than we've ever done. We're always looking to work with new partners, whether that's somebody as an external provider... or working with a developer along the way and then acquiring them later."

According to CNBC, Lempel pointed to Insomniac as a successful example of Sony's strategy. Sony initially partnered with Insomniac as a 'second-party' studio before eventually acquiring it. In 2021, Sony also made a series of acquisitions, including PC port specialist Nixxes, Housemarque (developer of Returnal), Firesprite (a VR developer), and Bluepoint Games (known for remasters and remakes). Last year, Sony purchased Haven Studios, the developer behind Fairgame$, and this year, they acquired Firewalk Studios.

Given these moves, the industry is now left wondering whether Sony will continue its acquisition spree, and at the same time, there is speculation about whether Microsoft has finished its acquisition efforts or if it has other major video game companies in its sights for potential acquisitions.