FTC-Xbox hearing dares to ask: What console gen is Nintendo?

One of the more amusing tangles Microsoft, Sony, and the Federal Trade Commission have gotten into over the past week is something that has roiled video game forums, and particularly riled Nintendo fans, for nearly two decades: Is Nintendo’s latest console part of the current generation?

Even if, as Xbox boss Phil Spencer said on Friday, the “console wars” are a social construction, this is still something that has built up since the days of the Wii and a memorable Game Developers Conference rant in which a Maxis developer dismissed Nintendo’s then-new console as “two GameCubes duct-taped together.”

The argument returned in force when the Wii U launched in 2012, and there was much garment-rending over whether Nintendo’s first high-definition console was part of the Xbox 360 and PlayStation 3 console generation, or if it had begun the next generation. I remember, vividly, the resentment from Wii U fans when Activision PR played coy about the idea of Call of Duty: Ghosts launching on Wii U. (It was the last Call of Duty to launch on a Nintendo platform.) And it didn’t help that the Wii U was a clunker at retail, and that third-party publishers all but gave up on Nintendo at the time.

Today, it’s no longer a console-wars pub argument. The FTC is asking a judge to stop Microsoft’s $68.7 billion acquisition of Call of Duty maker Activision Blizzard, contending that a console maker with that kind of publishing scope and control would harm consumers and the marketplace. The question is, who is part of that marketplace?

Image: Infinity Ward/Activision

Lawyers for the government and Microsoft have offered competing visions of what that market is: If it’s just PlayStation and Xbox, it’s a little easier to argue Microsoft gets an unfair advantage in acquiring Activision Blizzard. If it’s a global three-way race, especially against the blistering sales performance of the Nintendo Switch, Microsoft can better make the case it’s more of an underdog than a market bully.

That has put witnesses like Jim Ryan, the head of Sony Interactive Entertainment, in the uncomfortable position of commenting on competing hardware’s capabilities without looking like he’s punching down. And it’s seen some interesting admissions and contortions from Xbox boss Phil Spencer as he explains why Microsoft would view the Switch as an equal competitor even if it couldn’t run some of the biggest games his division publishes.

“In terms of processing power, of GPU, the graphics processor, CPU, Switch is more akin to a generation eight than a generation nine [console], right?” the FTC’s James Weingarten asked Spencer on the stand Friday.

“I wouldn’t agree with that,” Spencer replied, veering into a discussion of the Switch’s mobile capabilities, where the PlayStation 4 and Xbox One have to be plugged into a wall. Weingarten then led Spencer through the Switch’s resolution and frame rate capabilities, getting Spencer to acknowledge they were inferior to what the Xbox Series X supports.

It’s also somewhat jarring to hear government lawyers referring to generations eight or nine of consoles, whose classification and chronology, by my reckoning, come from Wikipedia editors, publisher-level marketers, and investor relations representatives.

Weingarten brought up Call of Duty later in the hearing to further press the difference in console generations. “If Call of Duty launches on the Switch, it’s not going to look the same to a player, if that player were playing on an Xbox X [sic], correct?” he said. Again, Spencer deflected.

“Our goal if we launched Call of Duty on the Switch is that it would be at equal or better quality as other Switch games,” Spencer replied. Weingarten referred back to Spencer’s deposition where the same question was asked. “Answer: ‘It will not,’” Weingarten said, reading Spencer’s testimony.

Spencer was also asked why the company has separate competitive analyses that both include and exclude the Switch. Again, they did the deposition do-si-do, where Spencer had to be reminded that he earlier had testified that Xbox includes the Switch “to show an accurate global perspective of our relevance.”

The analyses that exclude the Switch are, Spencer said, because the PlayStation 5 and Xbox Series X are both “at the same point in their life cycle,” which would at least suggest he doesn’t literally view the Switch as a current-generation console. (The Switch launched more than three years ahead of the PS5 and Xbox Series X.)

Photo: Alex Wong via Getty Images

In his videotaped deposition, presented Tuesday, SIE’s Ryan didn’t try to have it both ways. “Many of the games that we make for PlayStation are simply too powerful to be played on the Nintendo Switch,” Ryan said under questioning from Microsoft’s attorney, Beth Wilkinson. “The Nintendo hardware does not have the processing power, the graphics capability to be able to play those games.”

Later on, Ryan was asked his views on Nintendo in the console market. “They are in the console market, but they are not our direct competitor,” he said. Wilkinson even walked Ryan right up to the edge of the Nintendo-as-kids’-stuff bait swamp, which he respectfully tiptoed around.

“Did you have a sense for why Call of Duty sales on Nintendo were not successful?” Wilkinson asked.

“My opinion would be [Call of Duty] is aimed at a very different audience to the standard Nintendo audience,” Ryan said, “[which] enjoys Mario, Zelda, not Call of Duty. My opinion.”

No one from Nintendo has been called as a witness, so we’re not sure if the company agrees with Spencer or Ryan here. But we’re sure at least their fans were chuckling when Wilkinson asked Ryan why Xbox was more popular in the United States than overseas.

“The majority of their games, many of their games, involve the element of shooting,” Ryan said.