FTC loses its appeal against Microsoft's acquisition of Activision Blizzard

by Danny Craig  · 
FTC loses its appeal against Microsoft's acquisition of Activision Blizzard
Activision

The Federal Trade Commission (FTC) has lost its appeal to overturn a 2023 decision that would have blocked Microsoft's $69 billion acquisition of Activision Blizzard.

The details:

  • In late 2022, the FTC announced that it had filed an antitrust lawsuit against Microsoft after the tech giant revealed its intention to acquire Activision Blizzard, with the goal of blocking the deal. The regulator claimed that the purchase would harm competition in the gaming industry, but US courts denied the FTC's request for an injunction in July 2023, with Microsoft finalizing the deal in September of that year. Following the acquisition, the FTC filed an appeal in December, seeking to overturn the court's previous decision.

  • Almost a year and a half after the FTC filed the appeal, the 9th Circuit Court has officially denied it (via Bloomberg), stating that the trial judge was correct in dismissing the injunction request. The court ruled that the FTC failed to prove its claims that the acquisition would harm competition by limiting access to Call of Duty. Its claim that the acquisition would have a negative impact on cloud gaming and subscriptions in the industry was also rejected after the FTC "failed to show" that Activision would have made its titles available on cloud services without being acquired in the first place.

  • The court also noted that the FTC's argument that Activision games could become exclusive to Xbox platforms is a common strategy in the industry, with rivals Sony and Nintendo having far more exclusives on their respective consoles. "All major manufacturers have engaged in this practice," Judge Daniel P. Collins said. "[Sony and Nintendo] both have significantly higher number of exclusive games on their platform than [Microsoft] does."

  • The FTC's attempts to battle Microsoft and Activision over the acquisition will likely come to an end with this loss. Since the acquisition, Microsoft has leaned heavily into a multiplatform strategy, releasing former Xbox exclusives on rival platforms and even preparing to bring Gears of War to PlayStation later this year. Microsoft Gaming CEO Phil Spencer has also stated that, while consoles are still an important part of the Xbox ecosystem, the company wants its games to be playable in as many places as possible.

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