The FTC is suing Microsoft in an effort to block its Activision Blizzard takeover. This comes after speculation that it was going to happen sooner or later.
Near the end of November, Reuters mentioned that the FTC was likely to file a lawsuit to block Microsoft from buying Activision Blizzard. No comment from the FTC arrived when Reuters asked for a comment. Thanks to this, the state of the lawsuit was unknown. That is, until today when the FTC announced that it would, in fact, be suing Microsoft to block the acquisition. This is one of the biggest updates to the Microsoft-Activision Blizzard deal since it came to light back in January.
The FTC, in the redacted public version of their lawsuit, explained much of why they want to block the acquisition. One reason is that they believe the acquisition will “result in a combined firm with the ability and increased incentive to withhold or degrade Activision's valuable gaming content to undermine its competitors in multiple Relevant Markets.” This would include Call of Duty, which Microsoft has mentioned again and again will remain on PlayStation. Holly Vedova, Director of the Bureau of Competition in the FTC, had the following to say about the deal:
Microsoft has already shown that it can and will withhold content from its gaming rivals. 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.
The FTC set August 2, 2023, as the date for an evidentiary hearing. The FTC is giving Microsoft a chance to present the reasons why the deal should go through. If they can't, the FTC will most likely require them to cease and desist from the purchase. This hearing comes after the EU and the UK gives their decision on the matter. For context, Brazil and Saudi Arabia have already approved of the purchase.
Brad Smith, Microsoft's president, had the following to say in response to the FTC's lawsuit:
We continue to believe that our deal to acquire Activision Blizzard will expand competition and create more opportunities for gamers and game developers. We have been committed since Day One to addressing competition concerns, including by offering earlier this week proposed concessions to the FTC. While we believe in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present it in court.
That's the latest news we have on the ongoing Microsft Activision-Blizzard deal. To stay updated on gaming news, you can check out our gaming news articles.
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