The United States Federal Trade Commission has said it plans to sue Microsoft to block their $68.7 billion dollar USD acquisition of Call of Duty publisher Activision Blizzard.
The FTC released an official statement on their complaint, which they’ve issued today, claiming that the deal would “enable Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription content and cloud-gaming business.”
The statement also makes reference to Microsoft’s purchase of Bethesda parent Zenimax back in 2020, pointing to its decision to make Starfield and Redfall Xbox exclusives.
“Microsoft has already shown that it can and will withhold content from its gaming rivals” was the statement from Holly Vedova, who’s the director of the FTC’s Bureau of Competition.
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“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 claims that “With control over Activision’s blockbuster franchises, Microsoft would have both the means and motive to harm competition by manipulating Activision’s pricing, degrading Activision’s game quality or player experience on rival consoles and gaming services, changing the terms and timing of access to Activision’s content, or withholding content from competitors entirely, resulting in harm to consumers.”
Microsoft and Activision have both separately responded to the FTC’s complaint in their own statements. First up was Brad Smith, the current Vice Chair and President of Microsoft, who posted the following to Twitter.
“We continue to believe that our deal to acquire Activision Blizzard will expand competition and create more opportunities for gamers and game developers,” he wrote.
“We have been committed since Day One to addressing competition concerns, including by offering early 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.”
Meanwhile, Activision’s Bobby Kotick offered up his own statement to investors in an open letter. “I want to reinforce my confidence that this deal will close,” he said.
“The allegation that this deal is anti-competitive doesn’t align with the facts, and we believe we’ll win this challenge.”
Just earlier this week, Microsoft committed to entering a ten-year agreement to bring Call of Duty games to Nintendo consoles, should the merger go ahead. Right now, that deal seems very much up in the air.
We’ll keep you posted of any further developments.
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