Over the last few months, we’ve tirelessly been covering Microsoft’s attempts to purchase Activision Blizzard. Now, thanks to a rather significant win on Microsoft’s part, this is all coming to a close.
Last month, the FTC filed for a preliminary injunction against Microsoft’s proposed acquisition of Activision Blizzard and as of last night, that filing has officially been denied, which means that Microsoft’s Activision Blizzard acquisition can now be closed – even though the FTC’s larger case against the deal is still moving forward.
The preliminary injunction by the FTC was only one step in the FTC’s case against the deal and was put into motion to prevent the acquisition from being completed before a final ruling on the proposed buyout could be made.
However, a judge has now rejected the FTC’s claim that Microsoft’s decision to make Starfield and Redfall console exclusives means the same could happen with the Call of Duty series. The judge stated that neither of the games used in the example is remotely similar to Call of Duty.
The judge also said that while the FTC has failed to support its case adequately, the intense scrutiny of the deal has paid off in making Microsoft commit to keeping Call of Duty on PlayStation platforms for ten years, as well as to bring the franchise to the Nintendo Switch and others.
In a statement released immediately after the ruling, Activision Blizzard CEO Bobby Kotick said:
“Our merger will benefit consumers and workers. It will enable competition rather than allow entrenched market leaders to continue to dominate our rapidly growing industry.
The ruling signals a path to full regulatory approval elsewhere around the globe. We’re grateful to the court for the way this process was handled and the thoughtfulness of the decision. The US joins the 38 countries where our deal can proceed—these decisions are based on facts and data that show our merger is good for players and for competition in the industry.”
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
But of course, there are two sides to every story, and the FTC doesn’t feel as elated by the court ruling:
“We are disappointed in this outcome given the clear threat this merger poses to open competition in cloud gaming, subscription services, and consoles. In the coming days we’ll be announcing our next step to continue our fight to preserve competition and protect consumers.”
The FTC will likely try to appeal the ruling, although nothing on that front has been confirmed yet.
The other hurdle Microsoft has been facing is in the UK. Still, UK regulators seem open to negotiating with the FTC case being dismissed.
The Competition and Markets Authority said in a statement that it is ready to consider any proposals from Microsoft to restructure the transaction in a way that would address the concerns.
Our statement on the mutual request with the CMA for a pause of our appeal in the UK: pic.twitter.com/8Aky2IJjxS
— Brad Smith (@BradSmi) July 11, 2023
The deadline for the acquisition is set for the 18th of July, and the FTC’s trial to determine whether the deal will be approved is set to get underway on the 2nd of August.