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Why is PlayStation being sued for £5 billion? Digital game ‘rip off’ claim explained

Sony PlayStation is being sued for £5 billion over what’s being described as “ripping off” gamers with inflated prices for digital games. Here’s why Sony faces legal action.

According to the lawsuit, filed by consumer champion Alex Neill in the UK, Sony has abused its dominant position in the market by overcharging for digital games within the PlayStation Store.

Read on for more information on what the claim is about, what laws have allegedly been broken and what gamers should do now…

What’s the issue here?

The crux of the claim is the 30% cut of digital game and in-game purchase sales Sony demands from developers. That fee is often passed onto the consumers, resulting in digital games often costing more than their physical counterparts.

Considering there’s now a Digital Edition of the PS5, which doesn’t accept physical games at all, this is more of a problem than it used to be, when all PlayStation gamers could choose a physical or digital copy and get the best deal.

Given the omnipresence of in-game purchases and DLC within modern games, the so-called “rip off” is even more prevalent, Neill, the CEO of the Resolver Group, claims.

In a press release, Neil writes: “The game is up for Sony PlayStation. 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.”

What laws have allegedly been broken?

The claim alleges Sony has breached competition law in the UK and wants the 8.9 million PlayStation gamers in the UK to be compensated.

But how has Sony broken the law? It has a right to make a profit, right? Well, Neill and the legal firm backing the case believe it comes down to the “excessive and unfair prices” that manifest due to Sony’s “near monopoly” on its digital store.

The claim to the UK’s Competition Appeal Tribunal reads:

We believe Sony’s conduct in relation to PlayStation amounts to an abuse of a dominant position which is in breach of UK/EU competition law, for the following reasons:

  • Sony has a near monopoly on the sale of digital games and add-on content through its control of the PlayStation Store.
  • Sony uses this dominance to enforce strict terms and conditions on game developers and publishers.
  • These terms allow Sony to set the price of digital games and in-game content and charge a 30% commission on every purchase of digital games and in-game content from the PlayStation Store.
  • This results in excessive and unfair prices to consumers for their digital games and in-game content.
  • These prices are out of all proportion to the costs of Sony providing these services to its customers.

Source: PlayStationYouOweUs website

Neill, who has filed a collective action legal claim, explains this is more egregious now due to the big changes in the business model for the gaming industry in recent years.

The website explaining the claim reads: “The business model of gaming has changed dramatically over recent years. The move from games sold as physical disks to games sold digitally has seen the introduction of in-game content, where players must now also pay to progress, unlock more features, or customise their experience with new characters or weapons. Games are now designed to incentivise players to spend as much money as possible (including children).

“We believe that customers are paying too much for these digital products and that they deserve to be treated better by Sony and compensated.”

Do PlayStation users have to do anything?

Gamers don’t have to do anything at the moment, as the case aims to achieve compensation for all PlayStation gamers. This is what’s considered an opt-out claim. If the legal action is successful, then gamers will be able to stake a claim.

The legal action states the value of the claim is between £67 and £562 per individual PlayStation gamer, so it could add up to a pretty penny. Whether it has a chance to succeed remains to be seen.

You can follow events at the PlayStationYouOweUs website and we’ll keep you posted too.

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