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The Federal Trade Commission (FTC) of the United States of America (USA) just filed a new complaint today that aims to block Microsoft's $69 billion (USD) acquisition of Activision Blizzard. This complaint is essentially a lawsuit, or a legal block, that will place at least a temporary stop to the acquisition being approved until such a point that this complaint is settled. This news comes in an email that the FTC sent to me this afternoon (imagine my surprise seeing an email from the FTC).
The FTC says that this acquisition "would enable Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription content and cloud-gaming business." The complain says that Microsoft has a "record of record of acquiring and using valuable gaming content to suppress competition from rival consoles, including its acquisition of ZeniMax, parent company of Bethesda Softworks (a well-known game developer)." They point to the fact that Microsoft is making several future Bethesda releases such as Starfield and Redfall exclusives to Microsoft platforms. The FTC claims that this was done "despite assurances it had given to European antitrust authorities that it had no incentive to withhold games from rival consoles."
I see where the FTC is coming from on this, but there is no precedence for either Starfield or Redfall because they are new IPs. There is a precedence for the Call of Duty franchise because it has been a multi-platform title for years now. That's also not to mention that Microsoft's statements to the European antitrust authorities were for the Activision Blizzard acquisition and not made for the acquisition of ZeniMax.
You have to wonder just what the FTC thinks about Sony's first-party studios. Why isn't Santa Monica Studio releasing God of War on non-PlayStation consoles? Should Xbox Series X|S owners expect The Last of Us Part 2 to get released? Maybe an Uncharted compilation for Xbox as well? Let's get Ghost of Tsushima on Switch while we're at it. None of that makes sense, of course, because those are all from Sony owned studios making games exclusively for Sony owned platforms. None of those games have had any sort of historical precedence for being released on other consoles.
The FTC argues that this past behavior is an indication that Microsoft would not continue to release multi-platform games after this acquisition.
Activision is one of only a very small number of top video game developers in the world that create and publish high-quality video games for multiple devices, including video game consoles, PCs, and mobile devices. It produces some of the most iconic and popular video game titles, including Call of Duty, World of Warcraft, Diablo, and Overwatch, and has a combined 154 million monthly active users around the world, according to the FTC’s complaint. Activision currently has a strategy of offering its games on many devices regardless of producer.
But that could change if the deal is allowed to proceed. With control over Activision’s blockbuster franchises, Microsoft would have both the means and motive to harm competition by manipulating Activision’s pricing, degrading Activision’s game quality or player experience on rival consoles and gaming services, changing the terms and timing of access to Activision’s content, or withholding content from competitors entirely, resulting in harm to consumers.
But that could change if the deal is allowed to proceed. With control over Activision’s blockbuster franchises, Microsoft would have both the means and motive to harm competition by manipulating Activision’s pricing, degrading Activision’s game quality or player experience on rival consoles and gaming services, changing the terms and timing of access to Activision’s content, or withholding content from competitors entirely, resulting in harm to consumers.
This complaint comes a little over a day after Microsoft issued a public commitment to bring Call of Duty to the Nintendo Switch and to continue releasing future Call of Duty titles on Steam. Approval of the acquisition is still pending in places such as North America and Europe.
