Internal documents from the legal proceedings between the Federal Trade Commission and Microsoft have revealed significant financial data regarding Sony Interactive Entertainment’s first-party development costs and the commercial impact of the Call of Duty franchise on the PlayStation platform. The findings provide a rare glimpse into the economics of "prestige" AAA game development and the strategic importance of third-party blockbusters to console ecosystems.
Analysis of poorly redacted testimony from SIE head Jim Ryan shows that development budgets for top-tier first-party titles now frequently exceed $200 million. Specifically, Horizon Forbidden West cost $212 million to develop over five years with a peak headcount of 300 employees. The Last of Us Part II required approximately $220 million and 70 months of development time, peaking at 200 full-time staff. While these titles are profitable and serve as hardware drivers, their high costs and lack of recurring revenue explain Sony’s recent strategic shift toward live-service games.
The data also underscores the massive scale of Call of Duty on PlayStation, where it generated $1.5 billion in worldwide consumer spending in 2021 alone. Since 2019, over 43 million unique PlayStation users in the United States have played the franchise, representing two-thirds of the platform's domestic user base. Modern Warfare II set a platform record by selling 4.4 million units in its first week. These figures highlight why Sony has aggressively opposed Microsoft’s acquisition of Activision Blizzard, as the franchise represents a critical pillar of PlayStation’s annual revenue and user engagement.
Beyond the lawsuit, the broader industry landscape shows a 9% year-over-year increase in U.S. gaming spend for May 2023, reaching $3.6 billion. While the Nintendo Switch led monthly sales due to the release of The Legend of Zelda: Tears of the Kingdom, the PlayStation 5 remains the top-selling hardware for the year. Additionally, industry sentiment regarding subscription models remains divided; internal communications suggest Sony leadership views multi-game subscription services like Xbox Game Pass as value-destructive to the traditional publishing business model.
