The FTC has filed a legal challenge to try to block Microsoft’s plan to buy Activision Blizzard for $68.7 billion, according to a press release from the regulator. The lawsuit was filed today after weeks of back and forth between Microsoft, Sony and regulators over competition concerns and the future of Duty. The FTC states that the acquisition would “allow Microsoft to stifle competitors from its Xbox gaming consoles and its burgeoning subscription content and cloud gaming business.” You can use the FTC’s redacted complaint here or embedded at the bottom of this article.
Today’s vote of the FTC commissioners means that Microsoft now faces significant hurdles in closing its Activision Blizzard deal. Regulators in the UK and the EU are also keeping a close eye on the deal, despite Microsoft’s repeated attempts to appease regulators.
“Microsoft has already shown that it can and will withhold content from its gaming rivals,” Holly Vedova, director of the FTC’s Bureau of Competition, said in a statement. “Today, we’re trying to prevent Microsoft from taking control of a leading independent game studio and using it to harm competition in multiple dynamic and fast-growing gaming markets.”
“We continue to believe this deal will increase competition and create more opportunities for gamers and game developers,” Microsoft vice chairman and president Brad Smith said in a statement to The edge. “We have been committed to addressing competition concerns since day one, including offering proposed concessions to the FTC earlier this week. While we believed in giving peace a chance, we have full confidence in our cause and welcome the chance to take our case to court.”
So does the company’s corporate vice president of communications, Frank X. Shaw tweeted a link to a document titled: “Get the facts: How Microsoft is committed to growing gaming communities.”
In a letter to Activision Blizzard employees, CEO Bobby Kotick told staff he wants to “strengthen my confidence” that the acquisition will be completed. “The claim that this deal is anti-competitive does not match the facts and we believe we will win this challenge.” he said. The company also posted an internal email written by Jeb Boatman, Activision’s SVP for litigation, regulation and public policy, to state its position on the deal.
Microsoft’s frustrations over Sony’s objections to the Activision Blizzard deal are clear. “Sony has emerged as the biggest objector,” Microsoft president Brad Smith said in a Wall Street Journal recently opted. “It’s as excited about this deal as Blockbuster was about the rise of Netflix.” Microsoft also described the concerns of Britain’s Competition and Markets Authority (CMA) as “misguided”, accusing the regulator of “taking on board Sony’s complaints without considering the potential harm to consumers”.
Microsoft has also accused Sony of paying developers to keep their content off the Xbox Game Pass service, and Sony even argued that Microsoft’s acquisition of Activision Blizzard “could hurt developers and lead to price increases”.
Updated December 8, 5:34 PM ET: Added FTC complaint.