The Federal Trade Commission on Thursday filed a complaint seeking to block Microsoft’s proposed acquisition of Activision Blizzard over concerns that it would harm competitors by withholding their access to popular titles, such as Call of Duty. The agency claims that Microsoft has a history of denying competitors access to content it acquired. Microsoft argues that the proposed bid will expand competition.
“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.”
The FTC reminds us that when Microsoft took over ZeniMax (the owner of Bethesda Softworks), it assured European antitrust agencies that it would not withhold games from competing console platforms. Yet, sometime after the deal was completed, Starfield and Redfall games were made Microsoft exclusives.
Being a leading independent game publisher, Activision Blizzard currently offers its titles on all platforms, including Microsoft’s Xbox and Windows, Sony’s PlayStation, and Nintendo’s Switch, to name a few. In addition, Activision has some of the world’s most-played titles — including Call of Duty, World of Warcraft, Diablo, and Overwatch — in its stable, so should Microsoft decide to harm its rivals by blocking their access to these games, it will affect hundreds of millions of gamers worldwide.
The FTC is by far not the first agency or organization aiming to block Microsoft’s proposal to take over Activision in a record $68.7 billion deal, which may become the biggest gaming industry transaction ever and one of the largest deals in the history of the high-tech industry. Numerous antitrust authorities are reviewing the proposed bid in-depth. Many companies, including Microsoft’s rival Sony, asserted that Microsoft would make popular titles from Activision Blizzard exclusive to its consoles and cloud gaming platform.
Microsoft itself denies any plans of wrongdoing and argues that the deal will expand competition and create more opportunities for gamers and developers.
“We continue to believe that our deal to acquire Activision Blizzard will expand competition and create more opportunities for gamers and game developers,” said Brad Smith, Vice Chair and President of Microsoft. “We have been committed since Day One to addressing competition concerns, including by offering earlier this week proposed concessions to the FTC. While we believe in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present it in court.”
It is not the first time the FTC has sued to block a large takeover deal. In December 2021, the FTC filed a complaint to block the Nvidia-Arm merger, citing concerns that once Nvidia gains control over Arm, it would withhold certain technologies from rivals to gain an advantage over them. Nvidia called off the proposal in February 2022, citing significant regulatory challenges.
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How does this "expand competition?"Reply
Thats just lawyerspeak for "protecting the people who pay me".bdcrlsn said:How does this "expand competition?"
While I tend to agree with blocking this acquisition, a little consistency would be nice. Where were governments for Disney's spending spree or Amazon buying MGM?Reply
Apparently Microsoft agreed to bring games like CoD to the Switch. However, I do agree with the FTC quite a bit.bdcrlsn said:How does this "expand competition?"
This really just appears to be a result of the shifting currents of public opinion. Generally speaking these acquisitions do far more damage than good, but in this case actibliz is such a toxic company it would probably be a significant improvement for the employees. Hopefully the regulators get reasonable concessions and then let it go through.Reply
I have NO problem with this ruling and allowing Microsoft taking it to court. My one problem with the ruling is that SONY isn't blameless in all of this. They have used similar tactics from withholding third party games or content from the competition by making it exclusive. They all do it except SONY has decided to throw its toys out of the pram, crying foul.Reply
SONY, is trying to keep their old business model in place which is, we build hardware and sell you games. Microsoft has decided to upset the apple cart by switching gears and saying, you don't need our hardware to play our games. Heck, if you want you can play them on a Samsung TV.
SONY has decided to hold on to the past while the industry is moving forward. When Gamestop unsettled game Publishers with their in your face bragging about used sales. Videogame Publishers cried foul because they weren't getting a cut on used sales, all the while Gamestop was making a killing. So the industry decided to fast forward the business model and deal directly with their customers via the console makers and digital delivery.
XBOX Game Pass is just an extension and a progression of this business model. SONY doesn't have anything as competitive as Game Pass even though they started their own similar service. So that's where the industry is heading and Microsoft sees that which is why it wants Activison so it can add to the Game Pass library. They have also indicated a willingness to offer long term contracts to third party games.
This really is NO different than Amazon upsetting the basket cart with storefront retail. Retail had to adjust. Best Buy nearly went out of business because of Amazon and now Best Buy is thriving because they invested into a dying business to compete with Amazon. Walmart is another company who has successfully taken on Amazon with their online business model and in several cases have outdone Amazon.
The bottom line is, there will always be changes to any business model. Companies who have defined and refined their business model do whatever it takes to protect their interest. SONY is in this category as they are trying to build a fort around how they have done business the past 25 years in the console space. They only reluctantly added their version of Game Pass which has not met expectations because of the success of Microsoft. They are trying to maintain what made them successful and just throwing a bone to their customers.
Good. The FTC should block this acquisition. All mergers of these gigantic holding companies should be blocked. There is entirely too much consolidation going on in the gaming industry. I can't stand ABK's executive leadership, but I'm not interested in seeing them get gone via this kind of merger.Reply
In my opinion, I think mergers are better than say Tencent owning large portions of every studio and publisher on earth. One day Tencent is going to do something nobody likes but no company will have a right to refuse cause they will own 51%+ of every company.Reply
In addition, Activision has some of the world’s most-played titles — including Call of Duty, World of Warcraft, Diablo, and Overwatch — in its stable, so should Microsoft decide to harm its rivals by blocking their access to these games, it will affect hundreds of millions of gamers worldwide.
I'd investigate bank accts as this entirely smells like Sony's prior statement and someone was bribed to do this.
pretty much.Heat_Fan89 said:My one problem with the ruling is that SONY isn't blameless in all of this. They have used similar tactics from withholding third party games or content from the competition by making it exclusive. They all do it except SONY has decided to throw its toys out of the pram, crying foul.
Bloodborne, Demon souls, original GoW games, timed exclusives like mhw & ff, etc,
exactly.Heat_Fan89 said:Microsoft has decided to upset the apple cart by switching gears and saying, you don't need our hardware to play our games. Heck, if you want you can play them on a Samsung TV.
also fact that MS lets you buy a game on console & w/o re-buying it you can play it on PC if u want too.
This is pro consumer mentality.
which is beneficial to them.Heat_Fan89 said:. So that's where the industry is heading and Microsoft sees that which is why it wants Activison so it can add to the Game Pass library. They have also indicated a willingness to offer long term contracts to third party games.
multiple outlets = larger audience = larger profit.
imagine how much $ Sony would make if they actually release bloodborne/demon souls onto PC...its THE reason you would ever get a console (console exclusives are legit anti consumer)
Sony's even said they no longer sell consoles at a loss so they arent subsidizing their cost via game purchases.
Also AVB has a god awful drama internally atm....how many lawsuits over past 3 yrs?
MS takes that serious and is the best option in industry to curb that and make sure doesnt happen again.
On a PC that's most likely running Microsoft Windows. MS still have ways of dragging money out of you that Sony wouldn't porting their exclusives to a PC.hotaru251 said:also fact that MS lets you buy a game on console & w/o re-buying it you can play it on PC if u want too.