The Federal Trade Commission U.S. (FTC) announced Thursday that it is dropping its bid to block acquisition Microsoft's. The decision marks a major reversal for the antitrust authority, which had previously expressed strong opposition to the largest-ever acquisition in the video game industry.
According to the FTC's statement, continuing the prosecution no longer serves the public interest, especially after the Commission's failure to overturn a court rulingon May 7 that refused to temporarily block the merger. The deal between Microsoft and Activision was set to expire in 2023.
Despite its initial efforts, the FTC was unable to secure a temporary freeze on the Microsoft–Activision deal, which would have given it time to challenge it before its administrative court — a strategy that in similar cases often leads to the cancellation of mergers.
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Microsoft scored a crucial victory in its months-long battle with the U.S. Federal Trade Commission (FTC) as the 9th Circuit Court of Appeals in San Francisco dismissed the commission’s appeal against its acquisition of Activision Blizzard. The verdict from the three-judge panel further strengthens the legality of the deal, which was initially approved in July 2023.
The acquisition of the “Call of Duty” creator has been the target of intense regulatory and political scrutiny since it was first announced in 2022. U.S. senators have raised concerns about the growing concentration of power in the tech industryas Microsoft continues to expand its portfolio of major gaming publishers. At the same time, competitors and gaming communities have warned of the dangers of exclusivity for popular franchises.
Microsoft, however, was quick to reassure the markets, stating that it does not intend to limit the release of titles like “Call of Duty” on competing platforms, denying scenarios of exclusions.
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Despite a series of attempts by the FTC to overturn the deal, the completion of the acquisition in October 2023 marked the beginning of a new era for Microsoft in gaming. The FTC's failure to overturn the deal on the final appeal appears to have closed the chapter of regulatory hurdles for the deal once and for all. This was evident in yesterday's announcement regarding the withdrawal from the case.
Microsoft president Brad Smith welcomed the development, calling it "a victory for gamers and for common sense in Washington."
The case’s withdrawal is part of a broader shift in strategy under new FTC chief Andrew Ferguson. Ferguson appears to be refocusing the commission’s priorities, shifting its focus to cases more aligned with Donald Trump’s political agenda — such as the investigation into possible collusion by advertisers to limit ad spending on Platform X (formerly Twitter).
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Part of this restructuring includes the withdrawal of other cases that were initiated under Lina Khan 's presidency , such as the recent cancellation of a case involving allegations of differential pricing by PepsiCo in favor of Walmart .
Source: www.theguardian.com
