In a game-changing move, a US judge has given Microsoft the green light to proceed with its highly anticipated acquisition of gaming powerhouse Activision Blizzard. The judge’s decision dismissed the antitrust enforcers’ request for a preliminary injunction to put the $69 billion deal on hold temporarily.
Following the favourable ruling, the Competition and Markets Authority (CMA) in the UK, which had previously expressed concerns in April, has announced its openness to reviewing and resolving antitrust issues raised by Microsoft. This positive news ignited a significant surge in Activision shares, which were already up by 5%, leading to a doubling of their value and an impressive 10% rise.
While Microsoft celebrates the court’s decision, the Federal Trade Commission (FTC) has been granted until July 14 to challenge the judge’s ruling. The FTC had originally sought to block the acquisition, citing concerns that Microsoft, the creator of the popular Xbox gaming console, would gain exclusive access to Activision’s highly acclaimed titles, including the best-selling “Call of Duty.” Their primary apprehension revolved around the potential limitation of these games solely to Microsoft’s platforms.
However, Judge Jacqueline Scott Corley disagreed with the FTC’s arguments in her ruling. She stated that the FTC had failed to provide substantial evidence to support their claim that the merged entity would likely withdraw “Call of Duty” from Sony PlayStation or that Microsoft’s ownership of Activision’s content would significantly hamper competition in the video game library subscription and cloud gaming markets.
Douglas Farrar, the spokesperson for the FTC, expressed disappointment with the outcome, emphasising concerns about the impact of the merger on cloud gaming, subscription services, and gaming consoles. Farrar affirmed that the FTC would soon announce their next steps to safeguard competition and protect consumers.
While Microsoft’s shares saw a minor dip in response to the ruling, Microsoft President Brad Smith took to Twitter, expressing gratitude for the judge’s prompt and thorough decision. Activision Blizzard CEO Bobby Kotick also chimed in, highlighting the potential benefits of the merger for consumers and employees. Kotick stressed that the deal would foster healthy competition, enabling them to challenge dominant players in the market and fuel the continued growth of the gaming industry.
If the Microsoft-Activision deal successfully concludes, it will not only mark Microsoft’s largest acquisition to date but also stand as the most significant transaction in the history of the gaming industry.
