In a nutshell: The acquisition of Activision Blizzard King could set Microsoft up to outpace Sony in the console market. Sony perceives this merger as a significant threat to its console and subscription sectors as it grapples with creating the ideal game subscription.

Microsoft faced fierce opposition in its bid to merge with Activision Blizzard King. It wasn't just regulators that had concerns. Sony was one of the deal's most vocal opponents. It was so boisterous with its protest that Microsoft had to promise to make Call of Duty available on PlayStation for the next 10 years.

Redmond's 10-year concession satisfied all regulators except the FTC. However, documents leaked from the Insomniac hack reveal that Sony is still deeply concerned. The PlayStation maker sees the acquisition as a formidable threat that could allow Microsoft to "leapfrog" Sony in the console market.

"Microsoft's acquisition of [Activision] positions it to leapfrog our current pillars," says a "confidential" presentation slide. "[Activision] provides incredible stratigic value across live service games, scale in mobile, and PC storefront ("

The slide notes Microsoft's effort to build a mobile game store to compete with Apple and Google. Indeed, Redmond plans to launch the store in 2024. However, the Verge notes that its success hinges directly on whether regulators force Apple and Google to open up their ecosystems to the extent that an alternative store has a chance. While we have seen some movement in this direction, it is not enough to allow an Xbox store to thrive on competing platforms.

Sony's rightfully pessimistic outlook forecasts Call of Duty doom in 2027, well before the 10-year promise concludes. It firmly believes the acquisition threatens both the console and subscription sectors. But how is that possible when Microsoft committed to 10 years of Call of Duty?

Sony sees Xbox overtaking PlayStation by weaponizing release timing. While Microsoft promised 10 years of Call of Duty, it did not specify that launches would coincide on both consoles. It sees Microsoft using that "exclusivity" period to advance its subscription dominance by putting Activision games on Game Pass "day and date" (day one).

"[Microsoft's] comprehensive ecosystem coupled with exclusivity creates greater dominance," another slide said.

Sony beancounters predict a massive threat to Sony's recently restructured PlayStation Plus that could lead to a $1.5 billion shortfall by 2027. Sony admitted that its "pillars are already dated and behind the competition." In other words, PlayStation's past dominance led to complacency, and now Sony feels threatened by a major brand being removed from the table.

It now has an urgent need to expand its offerings. However, the company struggles with finding the "perfect game subscription." Players expect free best-in-class games for a monthly fee, but Sonny feels that is an "unsustainable" model. It claims it cannot see a return on investment for premium games with reasonable "monthly and incremental" subscriptions.

Another weakness is that, unlike Xbox, PlayStation does not have a "unified mobile, PC, console experience." Sony has no solution for this shortcoming other than a continued focus on a "premium sales model." However, that would be the status quo for PlayStation, and from the sound of it, even Sony doesn't believe that will be enough.