It’s official. After months of rumors, the Federal Trade Commission this week voted 3-1 in favor of suing to block Microsoft’s estimated $69 billion acquisition of video game giant Activision Blizzard.
The forthcoming legal battle represents the most significant antitrust challenge from the Biden-era FTC to date that has, up until now, had few tangible victories to back up its progressive, anti-monopolist rhetoric. The challenge’s success or failures could play a large factor in determining whether or the Biden administration can live up to its image as an aggressive antitrust maverick.
In a press release Thursday, the FTC argued the acquisition, if allowed to occur, would let Microsoft suppress competitors to its own Xbox gaming console and its growing cloud gaming business. Microsoft, according to the FTC, had already demonstrated a pattern of acquiring big name game studios like Bethesda only to make their titles exclusive to Microsoft’s platform.
“Microsoft has already shown that it can and will withhold content from its gaming rivals,” FTC Bureau Director of Competition Holly Vedova said in a statement. “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 vote comes just days after Microsoft announced it intended to bring Activision’s massively popular Call of Duty franchise to Steam and Nintendo consoles. Sony, Microsoft’s primary competitor in the console gaming sector, shot down an offer to keep the franchise on Playstation for 10 years. Sony has opposed the acquisition outright and claimed the deal would have, “major negative implications for gamers and the future of the gaming industry.”
Microsoft Vice Chair and President Brad Smith commented publicly on the FTC’s decision and expressed confidence in the acquisition which he believes would, “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,” Smith said on Twitter. “While we believe in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present it in court.”
