Back in December 2022, US Federal Trade Commission (FTC) expressed its opposition to Microsoft-Activision Blizzard deal. FTC believed that this deal would lead to Microsoft’s Xbox division to gain control of top video game franchises, enabling it to harm competition in high-performance gaming consoles and subscription services by denying or degrading rivals’ access to its popular content.
In their press release, they said the below:
The Federal Trade Commission is seeking to block technology giant Microsoft Corp. from acquiring leading video game developer Activision Blizzard, Inc. and its blockbuster gaming franchises such as Call of Duty, alleging that the $69 billion deal, Microsoft’s largest ever and the largest ever in the video gaming industry, would enable Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription content and cloud-gaming business.
Today, CNBC reported that the FTC is set to file for an injunction seeking to block Microsoft’s proposed acquisition of Activision Blizzard. By filing for an injunction, the FTC is trying to stop the acquisition from going through before its July 18 deadline.
Through that trial-like process, the ALJ (administrative law judge) would make an initial decision that could be appealed to the full commission for a vote. After that, Microsoft could appeal to a federal court should the decision not go its way.
Microsoft is happy with FTC’s injunction as it would bring the case before a federal judge faster.
Microsoft earlier said that they will continue to engage with regulators with a spirit of transparency and openness as they review this acquisition.
In May, the European Commission approved Microsoft’s proposed acquisition of Activision Blizzard. However, the approval is conditional on full compliance with the commitments offered by Microsoft. The commission believed that the commitments offered by Microsoft fully address the competition concerns identified by them and represent a significant improvement for cloud gaming as compared to the current situation.