PlayStation faces £5 billion lawsuit for allegedly ‘ripping off’ customers

A collective action being brought against Sony in the UK accuses the PlayStation company of “ripping people off” on its digital store.

Alex Neill, a consumer rights advocate, filed the legal claim claiming Sony is violating competition law by demanding a cut on every purchase made via the PlayStation Store.

According to the claim, players in the UK have been ‘overcharged’ for digital purchases by £5 billion ($5.9 billion) over the course of the last six years.

The claim was filed with Competition Appeal Tribunal last Wednesday. It states that it covers any person in the UK who bought DLC or games via the PlayStation Store from August 19, 2016, to around 9 million.

If the action is successful, each person would be entitled to anywhere between £67 and £562 damages, plus interest.

It seems that the argument revolves around terms and conditions Sony places on publishers and developers who want to sell digital PlayStation Store games and add-on content.

Sony takes a 30% cut of every purchase made, just like Steam, Xbox and the App Store (Epic takes a lower 12%), and it’s this cut that Neill claims is “ripping people off”.

It’s not clear if the suit is claiming that Sony shouldn’t be taking any commission for third-party sales on its digital stores, or whether the 30% should simply be reduced.

“The game is up for Sony PlayStation,” Ms Neill said in a statement to Sky News.

“With this legal action I am standing up for the millions of UK people who have been unwittingly overcharged. We feel that Sony has misused its position and ripped off its clients.

“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.

“The actions of Sony is 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.”

Natasha Pearman, the partner leading the case, added: “Sony dominates the digital distribution of PlayStation games and in-game content – it has deployed an anti-competitive strategy which has resulted in excessive prices to customers that are out of all proportion to the costs of Sony providing its services.”

Sony won a US court’s consent to dismiss a second lawsuit alleging that the PlayStation Store was anticompetitive.

According to the suit, Sony had illegally monopolized the market by selling digital copies of PlayStation Games on its PlayStation Store.

However, according to the ruling, the plaintiffs – a group of players who buy games from the PlayStation Store – had to show that the decision to only sell games on the PlayStation Store was intended to cut off the competition and that it had ended a profitable business to take control of the market.

Judge Richard Seeborg of the US District Court for the Northern District of California concluded that this hadn’t been adequately proven.