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"fiaaigingmxz,fifi28535
IuneY,2012
TheHonorabie{MannaGkun
knternatianalTradeCammission
588EStreet,SWWashington,BC20436
Re:CertainGamingEntemainmentCansoies,RelatedSoftware.andComponentsThereof
investigationNo.337-TA~‘752
DearChafirmanOkun:
Wearewritingtoshareourviawsinconnectionwitfiapendinginvestigationbeforethe
lntematianaiTradeCommissionregardingMicrosoffsmnovativeXbox360ccmsoie.Ferthe
reascmsdiscussedbelow,weencourageyoutocunsiderthepotentiaiharmtathepubiicinterestaf
issuinganexciusionorderinthiscase.
AnexdusionnrdaragainsttheXb-ox360consoiecouidthreatenhigh-payingAmerican
jobsandcontinuedaconomicgmwthinWashingtcmandthroughoutthenation.TheMinrosoft
Xbax356iscaneofthree(tamperinggameconsumesthatmrmthecoreoftheU.S.entertainment
softwareindustry.AccerdingtadatareieasedbytheEntertaiamentSoftwareAssociationin2010,
from2005-2009,theantertainmentsoftwareIndustryintheUnitedStatesgrewatanannuairateofmomthan19parzent,whfletheU5.economycveraflgrewatarateoffessthantwopercent.
Duringthesameperiod,directemploymentintheentertainmentsafiwaraindustrygrewatarate
of8.6percent.Currenfiy,computerandvideegamewmpaniesdiremyandirrdirectiyemploymere
than120.690pwpiein34states.inWashmgtnn,theinaiustryisVamajoreconomicdriver,
accmmtingformorethan11,2£mobsand$525mimonindirectandindineatcampensationin2009.AnexclusionerdercouldcimetheU5.markettathisinrwvativeandhighiypaputarproductand
directlythreatenthejabsbumaroundit.\Anexciusionordercoulddestroythirdmartyimiestmants.Anexclusionorderbanningthe
impurtationofXbox360gamingconscfiescouidharmrm’;unlyMicroseft,but2breadrangeufcompanies-largeandsmafi-—hathaveinvestedindevelopingandprovidingproduntsandésewices
forthispiatformandwhosebusinessesheavflydependupenXbnxsafes.Theseindudegame
éeveiopersandpubiishers,retaiiers,andmanufacturersafcontroflersandotheraccessories.Aban
onimpertationoftheXbux36$cansolesouls!limitoreiiminateentiréiytheabifltvefthese
cempaniestaofferproductsandsewiaesinnewcustomersintheU5.'
AnexciuskvnurdarcouldbedetrimentaltaU.$.consumers.exclusimaftheXbox
maidsubstantialiyreducecompetitiunandwnsumercameandhastimepotentialtoleadbehigher
pricesforgameconsaiesandreiatedproducts.ConsumarswhahavealreadyseiectedXfbaavz60as
theirgamingconsoiehavetvpicaflymvasted--oftenhundredsandevent‘housandsafdeflam-—~n
miatedgamesandaccessoriesthatarenotcampatibleMththetwocompetinggamesystems.
ConsumerswhowishedtoreLp%ac»2,pgrade,erpurchaseasecandgameconsulsfurtheirmamas
mightnotbeabietnchoaseanewXbox360andcouldseamuhwastmemciestrayedandtheir
choiaesfarrepiaaamentfimited.1
PNNTEDGHi!§C’¥’QLE§3PAPER
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