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US antitrust watchdog moves to block Microsoft’s $69B acquisition of Activision Blizzard

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Dec 09, 2022 - 02:10 AM

ISTANBUL (AA) – The US Federal Trade Commission (FTC) said Thursday it is seeking to block Microsoft from acquiring Activision Blizzard.

The purchase deal for the video game developer “would enable Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription content and cloud-gaming business,” the antitrust watchdog said in a statement.

If realized, the $69 billion agreement would be the biggest acquisition in Microsoft’s history and for the video game industry.

The FTC said in a complaint, which was voted 3-1, that Microsoft has a track record of acquiring and using valuable gaming content to suppress competition from rival consoles.

The agency said the Seattle-based technology firm made several titles from video game developer Bethesda its exclusives, after acquiring parent company ZeniMax, despite assurances it had given to European antitrust authorities that it had no incentive to withhold games from rivals.

“Microsoft has already shown that it can and will withhold content from its gaming rivals,” said Holly Vedova, director of the FTC’s Bureau of Competition. “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.”

FTC noted that Activision is one of a few top video game developers that create games for multiple devices, including consoles, PCs and mobile devices, with 154 million monthly active users around the world.

“With control over Activision’s blockbuster franchises, Microsoft would have both the means and motive to harm competition by manipulating Activision’s pricing, degrading Activision’s game quality or player experience on rival consoles and gaming services, changing the terms and timing of access to Activision’s content, or withholding content from competitors entirely, resulting in harm to consumers,” it explained.

Microsoft’s record offer also faces a probe in the UK, as that country’s antitrust watchdog, Competition and Markets Authority, said in July it is considering whether the deal would “result in a substantial lessening of competition” in its markets.

Activision Blizzard has popular video game franchises, including Call of Duty, Guitar Hero, Diablo, Warcraft and Candy Crush.

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