The Federal Trade Commission is seeking to block Microsoft’s $69 billion acquisition of Activision Blizzard.
According to one Press Release, the Commission, which aims to protect consumers by promoting fair market competition, voted 3-1 to file a lawsuit aimed at preventing the deal’s closure. Therefore, a federal judge will weigh in and make a decision. Among other reasons, the FTC cites Microsoft’s record of using past acquisitions to “prevent competition from rival consoles” and points to the publisher’s purchase of ZeniMax at 2020 as an example, stating:
“Microsoft has decided to make a number of Bethesda titles including Starfield and Redfall exclusive to Microsoft even though they have assured European antitrust authorities that they have no incentive to keep the games. from rival consoles.”
The FTC adds that Activision is one of the few remaining major third-party publishers to offer some of the best-selling franchises across multiple platforms. It states that if Microsoft’s acquisition is successful, it will have “the means and motives to harm competition.” The FTC lists hypothetical examples, including Microsoft’s ability to degrade non-Xbox versions of Activision games or services, withholding content from other platforms, and manipulating prices in ways against consumers
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“Microsoft has shown that it can and will withhold content from its gaming competitors,” said Holly Vedova, Director of the FTC’s Competition Bureau. “Today, we seek to prevent Microsoft from gaining control of a leading indie game studio and using it to harm competition in many of the dynamic and fast-growing game markets.”
Activision CEO Bobby Kotick Responds to FTC’s vote to sue in a lawsuit Messages for staffsay in part:
“The allegation that this deal is anti-competitive does not align with reality and we believe we will prevail this challenge.” Kotick then added, “…the competitive landscape is changing, and put simply, a combined Microsoft-ABK will be good for players, good for employees, good for competition, and good for the industry. Our players want choice, and this provides them with exactly that. misconceptions about the tech industry.”
To date, the acquisition of Activision has been approved by international government trade bodies in Brazil, Saudi Arabia and Serbia (with no regulatory concessions). It is still under consideration by a number of international governments because of antitrust concerns, most notably the European Commission.
Yesterday, Microsoft announced that it has entered a 10-year commitment to Nintendo to bring Call of Duty back to its platform. It also said it plans to keep the series on Steam and has repeatedly stated its readiness keep Call of Duty on PlayStation to the foreseeable future. Of course, all of those promises are contingent on whether the deal passes all regulatory checks. Sony has been one of the strongest opponents of the acquisition, arguing that such a merger is uncompetitive and harmful to its brand.
