The U.S. Federal Trade Commission (FTC) recently shared plans to challenge Microsoft’s $68.7 billion (USD) acquisition of Activision Blizzard in court. In terms of the basis for the lawsuit, this centers on allegations that the deal would allow Microsoft to “suppress competitors to its Xbox gaming consoles and its rapidly growing subscription content and cloud-gaming business.”
"Microsoft has already shown that it can and will withhold content from its gaming rivals," Holly Vedova, director of the FTC’s bureau of competition, explained in a statement as quoted by Axios. "Today we seek to stop Microsoft from gaining control over a leading independent game studio and using it to harm competition in multiple dynamic and fast-growing gaming markets."
With the move by the FTC making the deal seem less stable, Activision Blizzard CEO, Bobby Kotick, published a response to Activision’s official website. In the press release, Kotick confirms that the FTC aims to file a lawsuit to block the merger with arguments to be heard in court. Despite this, Kotick expresses confidence that the deal will close and that the allegations suggesting the deal is anti-competitive “doesn’t align with the facts, and we believe we’ll win this challenge.”
Kotick’s confidence in the deal closing isn’t unfounded as the FTC has chosen to duke it out within the confines of its own administrative court as opposed to pursuing the matter in federal court. As reported by outlets like Axios, the FTC isn’t seeking a preliminary injunction to prevent the deal from closing either “so the two parties are still likely to close.”
Digging deeper into the FTC’s reasoning for challenging Microsoft’s acquisition of Activision Blizzard, it’s noted in an FTC statement that Microsoft has opted to make Bethesda titles such as Redfall and Starfield exclusive to Microsoft platforms “despite assurances it had given to European antitrust authorities that it had no incentive to withhold games from rival consoles.”
Previously, Microsoft has shared assertions that it doesn’t intend to withhold Activision Blizzard titles like Call of Duty from rival platforms, and even announced a 10-year commitment to bring Call of Duty to Nintendo platforms in the future. That said, it’ll be interesting to see this as well as the topic of exclusivity for other titles like Bethesda’s Starfield, argued in court.
For more on the matter, be sure to read through some of our previous coverage including the initial rumors suggesting the FTC will likely challenge Microsoft/Activision Blizzard deal in an antitrust lawsuit, and the EU commission investigating Microsoft’s acquisition of Activision Blizzard.