Sony, the maker of PlayStation consoles, is facing a class-action lawsuit that accuses it of operating an unlawful monopoly by restricting the purchase of digital games to its own online store. The lawsuit, filed in the UK, claims that Sony has overcharged millions of customers by imposing a 30% commission on all digital sales, resulting in prices that are significantly higher than physical copies of the same games.
The lawsuit alleges that Sony has abused its dominant position in the market by preventing third-party retailers from selling digital download codes for PlayStation games since 2019. This means that customers who want to buy digital games for their PlayStation consoles have no choice but to use the PlayStation Store, where Sony sets the prices and takes a hefty cut of the revenue.
According to the lawsuit, Sony’s digital monopoly has resulted in “supracompetitive prices” that are out of proportion to the costs of providing the service. The lawsuit cites examples of games that are sold for up to 175% more on the PlayStation Store than on physical discs, such as FIFA 21, which costs £69.99 ($82.63) digitally but only £25.99 ($30.66) on disc.
The lawsuit also claims that Sony’s digital monopoly harms competition and innovation in the gaming industry, as it reduces the incentives for developers and publishers to lower their prices or offer discounts to attract customers. The lawsuit argues that Sony’s digital monopoly violates the UK’s Competition Act 1998, which prohibits the abuse of a dominant position in the market.
The Potential Damages
The lawsuit, which is led by consumer rights advocate Alex Neill, seeks to represent up to nine million PlayStation customers in the UK who have bought digital games from the PlayStation Store in the past six years. The lawsuit estimates that each customer could be entitled to a refund of between £67 ($79) and £562 ($664), depending on how many games they have purchased. This adds up to a potential total of £5 billion ($5.9 billion) in damages, excluding interest.
Neill, who is the former managing director of consumer advice organisation Which?, said that he is standing up for the millions of UK people who have been “unwittingly overcharged” by Sony. He said that gaming is now the biggest entertainment industry in the UK, and that many vulnerable people rely on gaming for community and connection. He added that Sony’s actions are costing millions of people who can’t afford it, especially during the ongoing cost of living crisis.
Sony’s Response
Sony has not yet commented on the lawsuit, which was filed with the Competition Appeal Tribunal on August 19, 2023. However, Sony has previously tried to dismiss a similar lawsuit that was filed in the US in May 2021, arguing that it has not violated any antitrust laws and that customers have agreed to its terms of service. Sony also claimed that customers can still buy physical games from other retailers, and that its digital prices reflect the value of its products and services.
The US lawsuit, which is still pending, seeks to represent a nationwide class of PlayStation customers who have bought digital games from the PlayStation Store since April 2019. The lawsuit accuses Sony of inflating the prices of digital games by up to 100%, and seeks unspecified damages and injunctive relief.
Sony is not the only gaming company that is facing legal challenges over its digital practices. Apple and Google are also being sued by Epic Games, the maker of Fortnite, for removing the game from their app stores after Epic introduced a direct payment option that bypassed their 30% commission. The trial, which began in May 2021, has revealed many secrets and controversies in the gaming industry.