The Federal Trade Commission (FTC) has taken legal action in an attempt to block Microsoft’s plan to purchase Activision Blizzard for $68.7 billion, according to a regulator press release. This lawsuit was filed on December 8, 2022, after deliberation between Sony, Microsoft, and various regulators over concerns about competition and the future of Call of Duty.
According to the FTC’s argument, the acquisition enables “Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription content and cloud-gaming business.”
Microsoft now faces significant challenges in sealing its intended deal in the wake of the vote from FTC commissioners. Regulators in the EU and UK continue to scrutinize the deal very closely, despite the company’s repeated attempts to appease them.
According to the Director of the FTC Bureau of Competition Holy Vedova, “Microsoft has already demonstrated that it can and will withhold content from 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.”
In response, Microsoft vice chair and president Brad Smith stated that “we continue to believe that this deal 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 believed in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present our case in court.”
Frank X. Shaw, Microsoft’s corporate vice president of communications, tweeted a link to a special document entitled “Get The Facts: How Microsoft is Committed to Growing Gaming Communities.”
CEO of Activision Blizzard, Bobby Kotick, told his staff that he wants to reassert his confidence in the closure of the acquisition. “The allegation that this deal is anti-competitive doesn’t align with the facts, and we believe we’ll win this challenge.” Furthermore, an internal email outlined where the company stands on the deal.