CGO Asks Competition Bureau to Investigate COD Pact

The Canadian Gamers Organization has asked the Canadian Competition Bureau to further investigate the pact between Activision and Microsoft allowing Xbox users to receive Call of Duty Elite Premium benefits earlier than other platforms. This move comes as many consumers around the globe who have purchased Elite Premium Memberships have had a reasonable expectation that additional paid downloadable content for Modern Warfare 3 would be released to premium members at the same time across platforms. Both Activision, Beach Head, and Infinity Ward employees are being bombarded with questions through social media as to why this pact applies to Elite Premium. CGO believes that this pact may be against competition rules in Canada, and have asked the Competition Bureau to further investigate. The letter sent in tonight to the Competition Bureau is as follows:

The Canadian Gamers Organization (CGO) is a consumer advocacy group for Canadian Gamers. We are contacting you to get more information on the legality of an agreement made between Microsoft and game publisher Activision around the Call of Duty game series. Microsoft has initiated into a partnership with the publisher Activation in which non-XBOX consumers have a penalty put on them for the availability of new content for this game. We are specifically concerned around a penalty being applied to premium consumers of Call of Duty Elite in which many gamers have spent approx $50 CDN for 9 months of additional game content which includes the purchase of addition maps for the game on all platforms. Consumers who have purchased Elite Premium Memberships have a reasonable expectation upon point of sale that all Elite Premium members would be receiving content at the same time, and nothing was disclosed for those who purchased the game and premium memberships. In December, the developer of the game officially published that XBOX Call of Duty Elite Premium Members would be receiving premium content first.

The partnership Microsoft has with Activision is that XBOX platform users would receive new additional DLC one month ahead of every other platform. We are also concerned about the lack of disclosure of such an arrangement towards consumers on point of sale, and through advertising especially through the Call of Duty Elite Premium memberships. CGO feels the current arrangement between Microsoft and Activision is unfair to the consumer that uses a non-XBOX version of the game, and maybe an attempt by Microsoft to gain an unfair competitive edge over other gaming platforms by putting penalties on consumers for not owning a suppliers nominated product. CGO’s believes the Competition Act clearly states rules against this practice in Canada.

CGO believes by putting a one month penalty on new DLC releases for non-XBOX consumers of Call of Duty Modern Warfare 3 is an example of the “tied selling” definition set out in Section 72 (1) of the Competition Act (R.S.C., 1985, c. C-34) which states:

“tied selling” means

(a) any practice whereby a supplier of a product, as a condition of supplying the product (the "tying" product) to a customer, requires that customer to

(i) acquire any other product from the supplier or the supplier’s nominee, or

(b) any practice whereby a supplier of a product induces a customer to meet a condition set out in subparagraph (a)(i) or (ii) by offering to supply the tying product to the customer on more favourable terms or conditions if the customer agrees to meet the condition set out in either of those subparagraphs.

Specifically CGO believes that more favourable terms are presented by the publisher Activision for those that acquire an XBOX gaming system over other platforms by allowing XBOX platform users to download this content early.

Under Section 72 (2) the Act states:

(2) Where, on application by the Commissioner or a person granted leave under section 103.1, the Tribunal finds that exclusive dealing or tied selling, because it is engaged in by a major supplier of a product in a market or because it is widespread in a market, is likely to

(b) impede introduction of a product into or expansion of sales of a product in a market, or
(c) have any other exclusionary effect in a market,

We would ask that the Competition Bureau further investigate.

Warm Regards,
Jason Koblovsky
(Co-Founder Canadian Gamers Organization)