FTC sues to block $69 billion Microsoft-Activision Blizzard merger

The Federal Trade Commission said Thursday it was suing to block Microsoft’s planned $69 billion takeover of video game company Activision Blizzard, saying it could remove competitors from its Xbox games consoles and business. growing subscription to games.

The FTC voted 3-1 to file the lawsuit after a closed meeting, with all three Democratic commissioners voting in favor and the only Republican voting against. A fifth seat on the panel is vacant after the departure of another Republican earlier this year.

The FTC’s complaint points to Microsoft’s previous game acquisitions, particularly of well-known developer Bethesda Softworks and its parent company ZeniMax, as an example of where Microsoft has made certain popular game titles exclusive despite assurances to regulators. Europeans that he had no intention of doing so.

“Microsoft has already shown that it can and will withhold content from its gaming rivals,” said a statement prepared by Holly Vedova, director of the FTC’s Competition Bureau. “Today, we seek to prevent Microsoft from taking control of a leading independent game studio and using it to harm competition in several dynamic and fast-growing game markets.”

Microsoft President Brad Smith suggested in a statement Thursday that the company is likely to challenge the FTC’s decision.

“While we believe in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present our case in court,” Smith said.

The FTC’s challenge — which is being filed in administrative court — could be a test case for President Joe Biden’s mandate to review big tech mergers.

Microsoft had stepped up its public defense of the deal in recent days pending a decision.

Microsoft announced the merger deal in January but faced months of resistance from Sony, which makes the rival PlayStation console and raised concerns with antitrust watchdogs around the world over the loss of access to popular Activision Blizzard game franchises such as Call of Duty.

Antitrust regulators under Biden “have said that for decades merger policy has been too weak and they’ve repeatedly said, ‘We’re changing that,'” former FTC chairman William Kovacic said.

The goal is “not to allow dodgy deals and not to accept weak regulations,” said Kovacic, who was a Republican commissioner appointed in 2006 by then-President George W. Bush. But he said trying to block the acquisition could trigger a legal challenge from Microsoft which the company has a good chance of winning.

“Obviously the company made a number of concessions,” he said. “If the FTC denies Microsoft’s undertakings, Microsoft would likely take them to court and say the FTC is incorrigibly stubborn about it.”

Microsoft announced its latest pledge on Wednesday, saying it would make Call of Duty available on Nintendo devices for 10 years if its acquisition goes through. He said he tried to offer the same commitment to Sony.

The deal is also the subject of intense scrutiny in the European Union and the United Kingdom, where investigations are not expected to be completed until next year.


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