Microsoft has passed arguably the most vital hurdle to becoming sole owners of Activision Blizzard in the most expensive tech deal of all time. Is this the beginning of an anti-competitive market within gaming?
The controversial deal which will dwarf what Disney paid for Marvel is a huge leap closer to getting done.
First announcing its bid to buy Activision Blizzard – the acclaimed publisher behind Call of Duty, World of Warcraft, and Diablo, among many others – back in January 2022 for a record fee of $69bn, Microsoft could officially wrap the deal up before the end of July.
Our initial reaction to last year’s announcement was one of trepidation, which was shared by a large portion of the gaming community and many industry-insiders.
With such financial muscle, it was posited that tech conglomerates hoarding our favourite franchises and properties could lead to an anti-competitive market and slippery slope to complete monopolisation. This concern was brought to light in an official capacity by the Federal Trade Commission (FTC).
1/We're grateful to the court for swiftly deciding in our favor. The evidence showed the Activision Blizzard deal is good for the industry and the FTC’s claims about console switching, multi-game subscription services, and cloud don’t reflect the realities of the gaming market.
— Phil Spencer (@XboxP3) July 11, 2023
In December, the US watchdog requested that lawmakers block a proposed merger on the grounds that it would set a dangerous precedent for console exclusivity, potentially leaving PlayStation and Nintendo out in the cold. This week, however, Judge Jacqueline Scott Corley dismissed the FTC’s challenge.
‘The FTC has not shown it is likely to succeed on its assertion the combined firm will probably pull Call of Duty from Sony PlayStation, or that its ownership of Activision content will substantially lessen competition in the video game library subscription and cloud gaming markets,’ she said.