In the dynamic landscape of tech news, the Federal Trade Commission (FTC) continues to challenge Microsoft’s acquisition of video game publisher Activision Blizzard. The recent call by the US government to a federal appeals court underscores the ongoing battle surrounding this high-profile merger.
FTC Challenges Lower Court Decision
The FTC argues that District Judge Jacqueline Scott Corley exhibited excessive deference to Microsoft’s assurances about the future of the popular first-person shooter game, “Call of Duty,” leading to the court’s approval of the deal earlier this year. The regulatory body contends that Judge Corley went too far in relying on 11th-hour contracts signed by Microsoft with gaming industry players, including Nintendo and Nvidia, to address anticompetitive concerns related to the blockbuster merger.
Antitrust Concerns in the Gaming Realm
Regulators express concerns that Microsoft’s control over major Activision titles, such as “Call of Duty” and “World of Warcraft,” could potentially lead to a dominant position as a video game publisher. This dominance may allow Microsoft to restrict these titles from rival console-makers or cloud streaming platforms. Despite Microsoft’s efforts to allay these fears through multi-year agreements and restructuring deals, the FTC insists that such arrangements may inadvertently grant Microsoft a monopoly over Activision’s content in various domains, including the market for video game subscription services.
Evolution of Deals and Regulatory Scrutiny
The FTC highlights Microsoft’s responsive actions, including multi-year agreements and negotiations with UK antitrust officials, as attempts to alleviate regulator skepticism. Microsoft’s flurry of licensing agreements, aimed at ensuring the continued availability of “Call of Duty” on rival platforms, altered the economic landscape according to the FTC. However, the regulatory body contends that the evolving nature of these agreements, entered into after the FTC filed its complaint, poses challenges in fully evaluating their impact.