SonyTokyo shares plunged more than 12 percent on Wednesday Microsoft announced plans to buy Activision.

The potential for increased competition from Sony’s PlayStation Division and investors are likely to be concerned about this. MicrosoftYou can pull popular games off the Japanese entertainment company’s platforms.

Sony has always been an innovator in the field of digital cameras. MicrosoftWith its first-party game portfolio, it can stay on top in console battles. Microsoft would have an impressive portfolio of hits games, including the Call of Duty and World of Warcraft franchises, should it complete the Activision purchase.

This content could be used to power Microsoft’s Game Pass subscription, which is a monthly service for a fee that gives users access to a large library of games on different devices. This service is similar to Sony’s PlayStation Plus and Now services.

Console makers often create exclusive games for their gaming consoles when they own the studio. Call of Duty games are available for both Xbox and PlayStation.

However, investors are concerned that Microsoft might take the games off PlayStation’s consoles and make them more attractive to Sony.

Piers Harding Rolls, Ampere Analysis’s games research director, stated in Wednesday’s note that “there is no doubt this deal weakens Sony place in the market.”

“Whether or not Activision Blizzard’s content is progressively made exclusive to Xbox platforms and services, inclusion of new releases into Xbox Game Pass for several major games franchises, including Call of Duty, will undermine Sony’s third-party business. Sony has benefitted from the ability to negotiate timed exclusive content for Call of Duty but this is now under threat.”

It’s been investing in virtual realities and has now revealed the results. second-generation headset called the PlayStation VR2.

Serkan Toto is the CEO of Kantan Games Tokyo-based consulting firm Kantan Games. He stated that Sony will probably continue to be focused on creating strong content.

Toto stated that “Sony will continue to push blockbusters,”

He said, “I believe the Japanese market has completely overreacted today.”

Sony, although not as big as Microsoft, isn’t far from being a victim of acquisitions. In Japan, the Japanese firm bought several small studios last year including Valkyrie Entertainment, which made the popular game God of War. Toto stated that Sony would likely pursue other acquisitions.

He said that Sony can fight back. They still have top-of-the-line studios around the globe, PlayStation is a strong brand in gaming and there are acquisitions in the works for Sony.”