Sony is being sued for a whopping £5 billion for “ripping people off” on its PlayStation Network Store. Yikes!
As reported by Eurogamer (via Sky News), the legal claim is being made by Alex Neill, an ex-managing director of Which UK. In case you didn’t know, Which is a UK-based company that reviews the practice of customer service, and quality of goods and tests products to ensure they meet consumer standards.
Has Sony been unfair to consumers?
The legal claim was filed with the Competition Appeal Tribunal last week. Moreover, the filing claims by Sony charging a 30% commission on digital goods on its PSN Store, is in breach of competition law.
It is claimed that Sony is abusing its marketing power and stronghold within the industry and thus, imposes unfair terms and conditions on game developers as well as publishers. Consequently, it is also claimed that consumer prices increased as a result.
The court filing also states that anyone in the UK that has purchased content via the PlayStation Store from August 19th, 2016 is entitled to compensation.
Furthermore, it is believed that up to nine million customers could be eligible to make a claim. A website called “PlayStation You Owe Us” has been set up to campaign against Sony.
Sony is not the only one charging 30%
Furthermore, it is said that an average customer claim could range anywhere from £67 to £562 (excluding interest). However, the report from Eurogamer, says that the 30% cut from Sony is an industry standard, which is also set by the likes of Microsoft, Steam as well as the App Store.
“The game is up for Sony PlayStation,” exclaimed Alex Neill. “With this legal action, I am standing up for the millions of UK people who have been unwittingly overcharged. We believe Sony has abused its position and ripped off its customers.”
“Gaming is now the biggest entertainment industry in the UK, ahead of TV, video and music and many vulnerable people rely on gaming for community and connection,” Neil continued.
“The actions of Sony are costing millions of people who can’t afford it, particularly when we’re in the midst of a cost-of-living crisis and the consumer purse is being squeezed like never before.”
Eurogamer reached out to Sony
“It’s a tough case to bring,” Richard Hoeg, host of video games industry legal podcast Virtual Legality told Eurogamer. “First, you have the issue that each individual transaction was voluntarily made at the price(s) offered. Second, the prices largely mirrored those across the industry at the time.
“Third, the intermediary pricing (the 30% cut), was also mirrored by other market participants at the time. Fourth, although the 30% argument mirrors Epic’s in Epic v Apple, you have a lot of language, in that case, attempting to distinguish the console markets. (Though such language is not controlling, and may not even be persuasive.)“
“Fifth, that there’s no indication that a change to the 30% cut actually would affect the bottom-line consumer-facing pricing. (And there’s some indication that it wouldn’t, see [the] Epic Games Store.)
“Sixth, that because the 30% was established before any market controlling position, you have an issue establishing that it was an anti-competitive price.”
This isn’t the first case against Sony
This is not the first consumer case of Sony being sued. In 2021, a US lawsuit claimed that Sony was blocking third-party sales of digital codes. It was claimed that Sony owned the monopoly of digital codes and was consequently accused of being anti-competitive. The case was eventually dismissed.
In my opinion, it’s unlikely that this latest lawsuit will go anywhere. Especially when considering that Sony is not the only company to charge 30% on its digital store. However, perhaps at the very least, customers may be compensated with PSN Store credit.
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