IG news Update,
Well, here’s a pre-Thanksgiving stunner. According to political man, the Federal Trade Commission is “likely” to try and stop Microsoft’s attempt to buy Activision Blizzard for $68.7 billion. The agency is likely to file an antitrust suit as soon as next month. If the FTC takes such a step, it would be a major stumbling block to the deal.
The report added that the FTC’s four commissioners have not yet voted on whether to file a lawsuit. The agency has not yet met with attorneys for Microsoft or Activision Blizzard about the possibility. Although, political man FTC staff members are said to have questioned some of the claims made by Microsoft and Activision.
The FTC is said to be primarily concerned with whether the merger would give Microsoft an unfair advantage in the video game industry. As things stand, Xbox is the third largest player in the gaming market after PlayStation and Tencent.
Microsoft and Activision have tried to downplay the significance of the deal (which is, again, worth $68.7 billion). Sony has claimed that if Microsoft keeps games like Call of Duty away from PlayStation, then Sony will suffer a big loss.
If Microsoft removes Call of Duty from PlayStation, then Sony may have to bear the loss of millions of dollars annually. However, Microsoft said it offered Sony a deal earlier this month to keep Call of Duty on PlayStation for 10 years.
Microsoft has also said that the Activision deal is more about helping players get into mobile gaming (via the likes of candy Crush Saga) rather than improving their PC or console offerings. It wants to keep Activision Blizzard titles on Game Pass.
Microsoft and Sony have been slinging mud at each other in regulatory filings in multiple countries over the past few months. They both cherry picked facts to support their arguments. For example, Microsoft claims that Call of Duty isn’t an essential game for Sony and that putting it on Game Pass won’t hurt PlayStation.
Activision disputed claims that the deal would also negatively impact competition. Activision spokesman Joe Kristinat said, “Any suggestion that the transaction could have an antitrust effect is completely absurd.” political man, “This merger will benefit gamers and the US gaming industry, especially as we face increasingly stiff competition from overseas.”
Last month, one of the FTC’s Republican members quit, meaning the agency has three Democratic commissioners and one Republican. Noah Phillips, who left his position as commissioner, opposed several efforts by FTC chair Leena Khan to rein in the power of the tech industry. For example, he voted against a lawsuit that seeks to block purchases within Meta’s VR startup called Unlimited. In other words, if Khan wants to pursue an antitrust lawsuit against the Microsoft-Activation Blizzard deal, he will now face less resistance from other commissioners.
political man says the FTC is at the forefront of its antitrust investigation, which could begin as far back as February. The agency has reportedly already heard testimony from Microsoft CEO Satya Nadella and Activision counterpart Bobby Kotick.
FTC regulators have other concerns about the Microsoft-Activation deal beyond Call of Duty. “Investigators are trying to determine how Microsoft may be taking advantage of future, unannounced titles to promote its gaming business,” political man it is said. UK and EU regulators are also closely scrutinizing the acquisition, meaning it will be at least spring before Microsoft and Activision can close the deal.
I’ve been saying since it was announced that the planned merger is far from a done deal, but any FTC lawsuit could be the death blow. political man Notes that if the FTC files an antitrust lawsuit by the end of the year or in January, it’s unlikely to be resolved before July — which is after the deadline Microsoft and Activision set to close the deal Is. If this were to happen, the companies would have to renegotiate their agreement or else walk away from the merger.
Again, there’s no guarantee that the FTC will attempt to block the merger. but of politics The reporting is usually solid and there is no smoke without fire. We will have to wait and see how things turn out in the coming weeks and months.
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