Microsoft (MSFT) Announces Safe Gaming Partnership

Microsoft Corporation (MSFT) has issued a joint statement of principles with rival video game giants Nintendo Company, Limited (NTDOY) and Sony Corporation (SNE). "Our Shared Commitment to Safer Gaming" is essentially a pledge to protect both younger and more vulnerable players from inappropriate content and abusive or exploitative behavior by other players.

Absent any specific incidents that may have triggered such a move, a likely explanation for this surprise announcement is that these companies are making a pre-emptive strike against the sort of intensive political scrutiny that is besetting other big tech companies, particularly Facebook, Inc. (FB).

Three Guiding Principles

The joint statement by Microsoft, Nintendo, and Sony enunciated three principles that will guide their work:

• "Prevention: Empower players and parents to understand and control gaming experiences."
• "Partnership: We commit to partnering with the industry, regulators, law enforcement, and our communities to advance user safety."
• "Responsibility: We hold ourselves accountable for making our platforms as safe as possible for all players"

In summary, the statement asserts: "This partnership signifies our commitment to work together to improve player safety and ensure gaming remains truly for everyone."

Significance for Investors

"It seems like it's come out of the blue," remarked Michael Goodman, director for digital media at research firm Strategy Analytics. "There doesn't seem to be any privacy issues or breaches that would require this sort of response," he added.

However, Goodman continued: "Tech companies have been under a lot of pressure from Congress. This could be a way for them to get out ahead of the curve and disassociate them from Facebook, which is the poster child for Congressional ire."

Michael Inouye, an analyst with ABI Research, offered similar views: "Just as we're seeing a great deal of scrutiny being directed at social networks like Facebook, the gaming companies are no less subject to similar standards and evaluation, and in this case, they are taking a proactive approach to work towards a safe environment for all gamers."

In short, by taking a public stance against bullying and exploitative behavior in the gaming world, Microsoft, Nintendo, and Sony are hoping to burnish their images as good corporate citizens. If this effort succeeds in deflecting or minimizing potential political or regulatory scrutiny, that should be a positive for these companies and their investors. Furthermore, this effort may allay the concerns of parents and guardians who have been hesitant about permitting their children to engage in online gaming, thus opening up the possibility for additional sales.