<iframe src="https://www.googletagmanager.com/ns.html?id=GTM-P36XLWQ" height="0" width="0" style="display:none;visibility:hidden">

Microsoft’s US$68.7bn Activision takeover could be blocked by FTC

Temporary injunction will give US watchdog more time to review transaction.

13 June 2023 Steve McCaskill

Getty Images

  • Activision Blizzard publishes Call of Duty and key esports titles
  • EU has granted approval but UK has not

The US Federal Trade Commission (FTC) has filed an injunction to block Microsoft’s proposed US$68.7 billion takeover of video game publisher Activision Blizzard.

The competition watchdog had already sued to block the transaction so its in-house judge can review the deal and deliver an initial conclusion. However, the injunction means the acquisition cannot be completed until that process has been concluded.

The FTC has confirmed that following media reports the two sides were looking to complete the deal imminently, it has now applied for a ‘temporary restraining order’ to ensure that the deal cannot be closed until its own process has run its course.

The commission fears the merger could limit choice for consumers by requiring players to key Activision games, including Call of Duty, to play on PC or Microsoft’s Xbox console.

In response, Microsoft president Brad Smith said the company would “welcome the opportunity to present our case in a federal court.” Microsoft has already attempted to assuage competition fears by promising to make Call of Duty available to rival platforms, including Sony and Nintendo, for a decade.

The European Commission (EC), along with other regulators, have given their blessing to the takeover, but the UK Competition and Markets Authority (CMA) has blocked the deal. The British body says the combination would negatively affect the emerging cloud gaming market, reducing innovation and choice for consumers.

Both Microsoft and Activision Blizzard are appealing the ruling.

SportsPro says…

Although the FTC’s concerns lie predominantly in the field of the consumer video game market, its decisions will have an impact on the sports industry.

Gaming is the largest entertainment category by revenue in the world. It’s also an important fan engagement channel for rights holders and esports is a rapidly growing sporting discipline in its own right.

The takeover would hand Microsoft control over some of the most popular titles in the esports world, whilst also strengthening the PC and Xbox ecosystem as a key platform.

Despite assurances that many key titles would remain multi-platform, Activision’s library would become part of the Game Pass subscription service. This would make it more attractive to consumers, including those who view cloud gaming as a more affordable entry point.

This would inevitably have a knock-on effect on the wider esports market, not just at a participatory level, but also at a regulatory level given many major competitions are at the jurisdiction of individual companies rather than governing bodies.

1 / 2news articles read

Enjoying SportsPro content? Create your account and get enhanced access to all the latest stories.


Already have an account?