The video game world can often be a place were backs are stabbed, deals are broken, and high profile titans often clash through press releases and school-yard styled exchanges of words. The latest of these places Activision against console manufacturer and electronics giant Sony, with Activision, the largest third party video game publisher in the world last week threatening that it may have to discontinue support for Sony platforms such as the PlayStation Portable and the PlayStation 3 for a myriad of factors, the most important of which is profitability and market penetration.

Among Activision's demands are a reduce in price for the PlayStation 3 console, along with reduced expense and royalties for publishing games on the console, with the company paying some US$500 million to Sony in royalties alone last year. This would allow Activision to have a much higher profit margin on PlayStation 3 games than they currently do.

Sony have since struck back at the publishing giant, claiming that healthy business relationships between partners is best for consumers.

While it is no secret that Sony is struggling, (losing US$1 billion in the last financial year) the PlayStation 3 is being sold at a loss, and should Activision walk away from the PlayStation 3 and the PSP, stand to lose more than they could possibly gain by continuing to publish titles on the two Sony platforms.

The fiasco began late last week, when in an interview with The Times, Activision CEO Bobby Kotick claimed that Sony have to drop the price of the PlayStation 3 in a bid to increase software sales:

They have to cut the price, because if they don't, the attach rates are likely to slow. If we are being realistic, we might have to stop supporting Sony. When we look at 2010 and 2011, we might want to consider if we support the console — and the PSP too.

While it is highly unlikely that Sony or Activison will budge on the matter, can you imagine a PlayStation 3 game library free of future Activision titles? This would mean no future Call of Duty and no future Guitar Hero titles on the platform. Surely, Activision would be foolish to exclude themselves from 3 or more million sales of such games than getting no sales at all from the PlayStation platform.

If they're already pulling an incredibly large profit from the platform, wanting more just stinks of corporate greed and capitalism, and really, short changing Sony, who are operating at a loss after all research and development dollars slowly but surely get paid off.