Royalties are paid during disc fabrication. Only MS/Sony have the rights to print the discs, and there's something like £7 (most recent estimate I've seen) per disc printed, regardless of whether those discs sell or not. Obviosuly download titles will work with some fee, the details of which I know not, but my expectation is a flat fee rather than a percentage.
Actually the correct phrase should have been "Platform holders also get royalties AND percentage for every game sold" not "platform holders also get royalties FOR percentage FOR every game sold".
I said percentage but surely it can just be a fee as you say.
It's certainly possible for a console company to refuse publication for a game and there have been publisher controls in the past. One reason why Sony was so successful is they'd publisher almost anything while Nintendo were being fickle, as I understand it. A console company could try and control the publishers by threatening not to allow games, coercing the publisher/developer into making changes. But push too hard and all the publishers could ditch your platform and end your business. So in reality a common mutual ground is found, all sides appreciating they are codependent and having to make allowances. There will be anticompetitive laws that could be needed, but in reality it'll just be business as usual, with publishers making choices to try and get best revenues and keep the console companies happy, and vice versa.
Now I don't think Sony or MS can stop games they don't publish from being released just because for them they are bad without either breaking the agreement/partnership with the publisher/developer or loosing a lot of money.
I can't name a single game that was not released due to "quality reasons" after going gold.
Of course if I am wrong again please correct me without hesitation.
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