FTC filing suits to block Microsoft’s Activision Blizzard takeover

The Federal Trade Commission is suing to block Microsoft’s proposed acquisition of Activision Blizzard. It argues that if the acquisition goes through, Microsoft will gain an unfair advantage over its rivals.

This morning, the four-member committee voted to file a lawsuit. Three Democratic lawmakers (Chairmen Lina Khan, Rebecca Slaughter, and Alvaro Bedoya) voted in favor, while Republican lawmakers (Christina Wilson) voted against.The committee allegedly met with Microsoft the day before the concession was discussed Washington Post report.

if it is Press Releases Regardless, the commissioners didn’t believe Microsoft wouldn’t block Activision Blizzard’s popular title from competing services. The FTC cites Microsoft’s acquisition of Zenimax and how games like Starfield and Redfall became exclusives after the acquisition was completed.

“Microsoft has demonstrated that it can and will reject content from its gaming competitors,” FTC Competition Director Holly Vedova said in a statement. “Today, we sought to prevent Microsoft from gaining control of a leading independent game studio, and use it to harm competition in multiple dynamic and fast-growing gaming markets.”

The FTC is not the only government agency expressing concern about the impact of the acquisition. The UK Competition and Markets Authority is currently investigating.It recently concluded the first phase of the investigation and expressed concern its problem statement.

History of planned acquisitions

Microsoft announced its intention to Acquiring a publisher in January. With this acquisition, it became the distributor of popular game franchises such as Call of Duty, Candy Crush Saga, World of Warcraft, and more. It provided Activision Blizzard with approximately $69 billion.

Concerns about the size of the acquisition arose almost as soon as Microsoft announced the acquisition. The FTC reportedly opened an investigation Transactions occur almost instantly. Daniel Ahmad, senior analyst at Niko Partners, said At the time, Microsoft would have had to pay Activision $3 billion if the deal was blocked.

The current antitrust focus is on the Call of Duty franchise. Sony has repeatedly argued in public statements focused on the CMA investigation that Microsoft could undermine its competition with these popular and lucrative games. According to Sony, it could stop releasing them on Sony platforms entirely, or it could offer them on its Xbox Game Pass subscription service. Sony claims that Call of Duty on Game Pass will reduce demand for Sony’s console, even though Call of Duty is still launching on it.

Microsoft, in turn, responded that its competitors had plenty of exclusive games of their own. It also proposed 10-year deals with Sony, Nintendo, and Valve (the company behind PC game store Steam) to publish Call of Duty games on their platforms. it was announced earlier this week It signed such a deal with Nintendo.

Microsoft Vice Chairman and President Brad Smith at Statement to The Verge“We continue to believe this deal will expand competition and create more opportunities for gamers and game developers. We have worked to address competition issues since day one, including proposing concessions to the FTC earlier this week. While we believe in giving peace a chance, we are confident in our case and welcome the opportunity to present our case in court.”