A US court has removed one of the biggest hurdles for Microsoft (Xbox) to acquire Activision Blizzard (WoW, Diablo 4). MeinMMO tells you what this means for the deal.
What kind of deal is this? In January 2022, the tech giant Microsoft announced that it intended to acquire the gaming company Activision Blizzard. With a purchase value of approximately 69 billion US dollars, this would be the largest deal in gaming history.
The deal prompted antitrust authorities to take action: there was concern about the potential formation of a monopoly that could jeopardize market balance.
Besides the UK CMA (Competition and Markets Authority), the US FTC (Federal Trade Commission) also attempted to block the deal. A US court has now ruled in favor of Microsoft, thus lifting the FTC’s blockade.
The shooter Call of Duty was one of the central points of contention in the discussion about the acquisition. Sony feared that CoD would be offered exclusively for Xbox in the future and no longer for PlayStation.
Richtering says: More Call of Duty for everyone
What is the current development? A California court decided today, on July 11, 2023, that the planned acquisition of Activision Blizzard by Microsoft can be completed before the deadline of July 18.
The FTC could not prove that it would be successful in its claim that the acquisition would significantly impact competition, according to Judge Jacqueline Scott Corley, who presided over the case.
In her decision, the judge considered that Microsoft had committed in writing to keep Call of Duty on PlayStation at parity with Xbox for 10 years, and had even made an agreement with Nintendo to bring the shooter to Switch.
The evidence would thus suggest that consumers are likely to have more access to CoD and other Activision content, according to Corley (via The Verge).
Phil Spencer, head of Xbox, and Brad Smith, president of Microsoft, thanked the court on Twitter for the swift and thorough decision. Spencer wrote: “The evidence has shown that the deal is good for the industry.”
Bobby Kotick, the CEO of Activision Blizzard, also reacted to the decision: “Our merger will benefit consumers and workers.” (via The Verge)
CMA continues to block the deal
Is the deal finalized? Not quite yet, as British authorities continue to block the acquisition.
While the court’s decision allows Microsoft to complete the acquisition of Activision Blizzard before July 18, it’s only if the CMA is willing to negotiate a solution or Microsoft bypasses the UK in the deal.
The European regulatory authority had already given the acquisition the green light in May 2023. Thus, Microsoft could complete the deal even without the approval of the United Kingdom.
In a statement via Twitter, Microsoft, in the form of Brad Smith, expressed that while they do not agree with the CMA’s concerns, they are considering whether the deal can be modified in an “acceptable manner” to address the concerns.
To focus on working on these proposals, they have agreed with the authority to pause the legal dispute in the United Kingdom, as this is in the public interest.
The FTC now has the opportunity to appeal the decision before July 14 at 11:59 p.m. local time. We at MeinMMO will keep you updated on further developments.
You can read more about the background here:
