Rumors are making the rounds that Sony PlayStation is facing a government shutdown. I’ve heard some really dumb things claimed by pundits over the years. Still, the assertion that any governmental body is interested in shutting down the PlayStation brand takes the cake. However, there is a fraction of truth amidst the cacophony of YouTubers and podcasters pretending to be legal experts, and we’ll explain what it is below.
Is the government shutting down PlayStation?
No, there isn’t any government shutting down PlayStation. That’s complete clickbait, especially because anyone who makes this claim doesn’t even list which government is involved. After all, the fury of the US government looming over Sony is a lot more intimidating than if it were Zimbabwe, and that helps drum up views.
Fortunately, this hyperbolic claim’s root is much more sedate than you’d think. On November 21, 2023, the UK’s Competition Appeal Tribunal ruled that a suit filed by consumer advocate Alex Neill could move forward (via Reuters). The case targets the 30% commission Sony charges studios to publish games on their platform and is valued at around £6.3 billion ($8 billion).
The suit accuses Sony of abusing its dominant position by requiring digital games and add-ons to be bought and sold only via the PS Store. Due to the lack of competition, customers have paid higher prices for games and add-on content than they would have otherwise.
So, the UK government isn’t ordering Sony to shut down PlayStation operations in that country. A commission has just ruled that someone can sue the company. The suit itself has yet to move past the initial stages.
Of course, the whole claim that the UK could shut down Sony is flawed at its core. The UK is a democracy and won’t nationalize PlayStation and bring it to heel. The worst that will happen is that Sony could be ordered to pay the £6.3 billion back to publishers and open up the PS Store. The company is worth $107.3 billion, so it could easily take the hit. But if the brand closed in the UK, it’d be Sony’s choice rather than the government.
However, the suit has almost zero chance of succeeding. The 30% commission is an industry-standard, and both Nintendo and Microsoft share similar practices. Even if Sony somehow lost, it’d appeal until it only had to pay a fraction of the £6.3 billion judgment.
So, if you hear that any government is trying to shut down PlayStation, just roll your eyes and walk away. You’re dealing with someone who has no idea what they’re talking about.
